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You can flip it however you like: Switzerland, purely objectively, meets the three criteria that the United States government has set for brand-name currency handlers. And the National Bank again intervened massively in the foreign exchange markets in the year Corona.
Stop the Swiss franc from skyrocketing
UBS says that at the end of November, the SNB had bought currencies, mainly euros, for 120 billion Swiss francs. However, the SNB rejects the accusations. Because Switzerland does not intervene in foreign exchange to give the Swiss economy an unjustified competitive advantage.
The sole purpose of this is to prevent the Swiss franc from skyrocketing, because in times of crisis, like now, a large amount of foreign money flows into the franc.
Jordan’s excellent relationships
This then leads to a massive appreciation. The SNB sees its reaction as purely defensive. It remains to be seen if the new Biden administration will see it that way. One thing is already an asset: SNB President Thomas Jordan has excellent relations with the new US Secretary of the Treasury, Janet Yellen. She used to be the head of the US Federal Reserve and Jordan knows her from countless meetings.
Yellen is also a well-known economist who should understand the limitations of the Swiss central bank. It is difficult to say whether all of this will help avoid penalties. However, the new administration is likely to have bigger problems than punishing Switzerland.
Lipp Challenge
Business Editor
