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reAccording to insiders, Switzerland should meet the criteria to be classified by the United States as a currency manipulator in the future. According to several people familiar with the matter, the country is likely to be featured in a US Treasury report expected in the coming weeks. Although uncomfortable for Switzerland, the publication of the report does not automatically generate sanctions or tariffs.
The Swiss National Bank (SNB) intervened massively in the foreign exchange market this year to avoid the franc, which is demanded as a refuge in times of crisis and which would be detrimental to the local economy. In the first half of the year, the Swiss monetary authorities spent 90 billion francs or more than 2 percent of the gross domestic product that the United States accepts without accusing a country of monetary manipulation.
With a bilateral import surplus of more than $ 20 billion and a current account surplus of more than 2 percent, Switzerland also meets the other two criteria applied by the United States. The SNB declined to comment and there were no direct comments from the US Treasury Department.
Switzerland has already countered the American accusations. After all, the Alpine republic was put on the watch list by the Ministry of Finance a year ago. According to Swiss Leesart, the central bank’s interventions in the foreign exchange market are motivated purely by monetary policy and therefore did not serve to gain commercial advantage. Rather, its objective was to avoid the negative consequences for price stability and the economy of an overvalued franc.
For almost six years, the SNB has been fighting an appreciation of the Swiss franc with record negative interest rates and interventions in the foreign exchange market. Between 2011 and 2015, it set an official upper limit for appreciation, but then dropped it.
