16 Jan 2015
A day in FX history; EUR/CHF - Investec
FXStreet (Guatemala) - Jonathan Pryor, Corporate Treasury Analyst at Investec noted the activity around the SNB decision to remove the 1.2000 floor in the EUR/CHF.
Key Quotes
"A historic day in Foreign Exchange yesterday that saw the EURCHF fall over 30% after the Swiss National Bank (SNB) announced an end to their Euro-Swiss currency intervention floor. The Central Bank also slashed the main deposit rate by 50bps to -0.75% in an attempt to halt huge safe haven inflows of money into Swiss deposits."
"Only a few days after SNB Chief Jordan reaffirmed the Swiss Franc cap as a key part of monetary policy, the Central Bank removed the floor unexpectedly with a near 20% drop before most banks could see any tradable pricing, with the pair falling some 35% at its peak. In the largest single move by a G7 currency in recent times, prices and volatility became so extreme markets were in disarray. As Euro-Swiss fell we saw Euro weakness against other majors with Sterling-Euro breaking above 1.3000 for the first time in six years and trading up to 1.3100 within the same session."
Key Quotes
"A historic day in Foreign Exchange yesterday that saw the EURCHF fall over 30% after the Swiss National Bank (SNB) announced an end to their Euro-Swiss currency intervention floor. The Central Bank also slashed the main deposit rate by 50bps to -0.75% in an attempt to halt huge safe haven inflows of money into Swiss deposits."
"Only a few days after SNB Chief Jordan reaffirmed the Swiss Franc cap as a key part of monetary policy, the Central Bank removed the floor unexpectedly with a near 20% drop before most banks could see any tradable pricing, with the pair falling some 35% at its peak. In the largest single move by a G7 currency in recent times, prices and volatility became so extreme markets were in disarray. As Euro-Swiss fell we saw Euro weakness against other majors with Sterling-Euro breaking above 1.3000 for the first time in six years and trading up to 1.3100 within the same session."