“This designation by the Americans will have no influence on our monetary policy,” said the President of the Swiss National Bank (SNB), Thomas Jordan, on Monday in an interview with the business magazine ECO on Swiss television.
“At the moment, these interventions in the foreign exchange market are very important because we saw great pressure on the franc, especially during the Covid crisis,” said Jordan. “If you just look at the nominal exchange rate development, how much the franc has appreciated over the past twelve years, how low our inflation was, then everyone should see that Switzerland is anything but a currency manipulator.”
Talks with the USA planned
With the US Treasury Secretary and former head of the US Federal Reserve (Fed), Janet Yellen, has not yet spoken about the subject, according to Jordan. “These talks will take place,” said Jordan. “First on a technical, then on a political level.”
For six years now, the central bank has been using negative interest rates and buying foreign currency to prevent the franc, which is in demand as a safe haven in times of crisis. In the first nine months of 2020, the SNB took a good 100 billion francs in hand.
SNB ensures price stability
Jordan recalled that state funding was not the main task of the National Bank. The SNB is tasked with ensuring price stability. The federal government and the canton could currently refinance the rising debts cheaply thanks to low interest rates.
When asked whether the companies needed additional Covid loans in the current lockdown, Jordan was reluctant. The situation must be monitored very closely. Currently, the credit system seems to be working and the banks are granting loans.
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