Tag Archives: SNB

On the other hand, a number of central banks have taken the dangerous approach of simply tailoring their message based on their audience: when speaking to technical experts, say one thing, and when speaking to the public, say another. The janus-faced SNB is a case in point. This rhetorical duplicity is important as it allows central banks to both assuage popular concerns over the stability of money, by fostering the illusion that they maintain control over price stability and monetary...

Weekly update on SNB interventions: Sight deposits are debt for the central bank. An increase of sight deposits implies more debt and SNB interventions

The latest data show that the Swiss National Bank (SNB) has lost over half its owners' equity compared to December 2014. It is now less than 40 billion CHF, as compared to 86 billion in December 2014. We show the history for balance sheet and owners' equity.

We regularly publish the SNB asset structure by currency, rating & duration. They shall be a template for the tactical asset allocation along these dimensions for other conservative asset managers - CHF holdings certainly excluded because the SNB nearly exclusively buys foreign assets.

Latest update for June 2015: The pace of SNB intervention is slowing. Sight deposits, the indicator for SNB interventions, rise by 0.5 billion francs per week. April and May: Sight deposits rise by 1.5 billion CHF per week. Thanks to this intervention the SNB is able to maintain the EUR/CHF around 1.0450.

Money creation and sight deposits may have two points of view: 1. The central bank creates money - i.e. the SNB decides to increase sight deposits when it does currency interventions 2. Commercial banks create money - inflows in CHF on Swiss bank accounts make those banks increase their "sight deposits at the SNB. If inflows in CHF are higher than outflows then CHF must rise, unless the central bank does currency interventions. We will present both alternatives.

This IMF data on the SNB website shows SNB Forex and gold reserves in the last month. It is so-called "IMF Special Data Dissemination Standard (SNB Data)"

In his first response to the Swiss financial tsunami on January 15, George Dorgan suggested that the EUR/CHF of 1.10 will not be reached any time soon. He explains where the SNB should intervene and if they sell Euros and dollars.