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SNB sits still as the Fed-ECB gap widens
The Swiss National Bank maintained the sight deposit interest rate unchanged at -0.75%, the three month libor target band was kept at -0.25%/-1.25% as expected. The recent bounce in the euro-complex has certainly its finger in today’s status quo from the SNB. The market has been unreceptive to the ECB’s 10 basis point cut on its deposit rate. And even if the ECB says to be ready to deliver more, Mr. Draghi seems to be sitting somewhat close to the bottom already. But nobody never knows what central banks could do to reach their targets, in this context, the ECB’s 2% target slowly rolls away with every dollar lost on the oil. And per se, this is a good reason for the SNB to not pull out all the weapons unnecessarily.

The euro-franc rate fluctuates within the reasonable 1.08/1.10 range, while the US dollar is again below the parity. Fortunately, the SNB has little to worry about the Fed as the latter is already in the grasp of the hawk.