The Swiss National Bank is “closely monitoring” increased fluctuation in the Swiss franc in recent weeks, Blick reported, citing central bank President Philipp Hildebrand.
A spokesperson at the central bank wasn’t available for comment. Hildebrand’s remarks follow a recent appreciation of the franc after the SNB ended attempts to counter gains. The country’s central bank may have to consider further moves to prop up the euro, according to economists and investors.
Intervention in currency markets to protect Switzerland’s export-led recovery would boost the SNB’s record currency holdings, leaving it vulnerable to losses as the euro weakens. The central bank may have to run that risk as the franc climbs against the euro on investor concern that the euro-area debt crisis will worsen.
The risk of inflation in Switzerland is “extremely low” and abundant liquidity can be absorbed in time, Hildebrand also said in the interview published on Blick’s website. The central bank is concerned about a possible property market bubble, though there’s “no reason for panic,” he said.
Credited from Bloomberg.
