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Old 05.05.2007, 00:14
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What's just happened to the Swiss Franc?

I keep a regular eye on it. It seemed to sort of plummet in value against the pound as soon as I accepted a job here, and I've changed as little as i can hoping it will come back.

It's ebbed and flowed a bit and, like a football match, I've been watching it ebb and flow and silently cheering or moaning as it goes up by 0.0100 and then comes down by 0.0150. Tiny tiny differences, but it helps the days go by.

Just looked at it now..

http://newsvote.bbc.co.uk/1/shared/f...6/intraday.stm

it went from nearly 2.415 to 2.39 in under an hour

That's great news for me

Long may the pound continue to fall and the Swiss Franc continue to rise.
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Old 05.05.2007, 01:27
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Re: What's just happened to the Swiss Franc?

One hour later......as you were!

Somebody must have made a killing with that little movement

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Old 05.05.2007, 08:57
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Re: What's just happened to the Swiss Franc?

That daily fluctuation wasn't the Swiss franc, but the pound. Sterling did that against other currencies too. See the US$ for example:

http://http://newsvote.bbc.co.uk/1/s...2/intraday.stm
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Old 05.05.2007, 13:40
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Re: What's just happened to the Swiss Franc?

Hi,

The same thing is happening for me and my euros.

When the spread between interest rates in the UK and Switzerland decrease, the rate should return more towards previous (in your case, favourable) levels. Interest rates are so high now that institutions can borrow CHF at Swiss levels and and buy sterling to get paid at UK levels which drives up the price of Sterling. (Maybe you're aware of this, in which case I apologise for appearing condescending).

Now, when they will reduce interest rates is another question... Anyone?
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Old 05.05.2007, 13:59
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Re: What's just happened to the Swiss Franc?

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Hi,

The same thing is happening for me and my euros.

When the spread between interest rates in the UK and Switzerland decrease, the rate should return more towards previous (in your case, favourable) levels. Interest rates are so high now that institutions can borrow CHF at Swiss levels and and buy sterling to get paid at UK levels which drives up the price of Sterling. (Maybe you're aware of this, in which case I apologise for appearing condescending).

Now, when they will reduce interest rates is another question... Anyone?
Yeah the "Carry trade" as they call it is more commonly associated with the Japanese yen, but the Swiss Franc definitely gets used for it as well.

It's a kind of trade that involves risk, so that when the share market had its little plunge a while back and got risk aversive, the Swiss Franc got quite a bit stronger as a result.

But the interest rates thing doesn't always apply. When the dollar was quite weak against the sterling somebody who favoured a strong dollar once said back in 2003

Quote:
there is a difference in interest rates, particularly between Europe and the United States, and that interest rate differential has caused people to sell dollars to buy euros to get a higher return on investment. And that's why you're seeing pressure on the dollar.
And, of course, the European Union is, like the United States, has got an independent organization that sets monetary policy. But you'll see a -- you'll see different behavior as interest rate spreads begin to narrow between Europe and the United States


Well the rates in the US, which at the time were a fraction of those in Europe and the UK, are now higher than in Europe and nearly up with those of the UK

yet the dollar has weakened

Mind you, the guy who said that wasn't much of an economist,...it was George W Bush
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Old 05.05.2007, 14:47
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Re: What's just happened to the Swiss Franc?

That man's a legend.

At this pont, I shrug my shoulders. But I guess there are other factors causing flows out of dollars. Countries are moving their investments out of dollars and into other currencies... inflation high in U.S.. But the EUR-CHF situation is more straightforward ...at least in my head

It got me thinking that maybe now is a good time to buy property here, if one is thinking about it... Which leads me to a question on who has bought property, but I will search the forum for such questions and start a new thread if necessary.
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Old 07.05.2007, 11:11
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Re: What's just happened to the Swiss Franc?

asked my husband the same question and he tried to explain to me in simple terms since I'm not in the finance sector.... And apparently because of the low interest rates in switzerland a lot of investors are buying swiss francs to invest elsewhere hence the "weak Francs". But for export its a plus for Switzerland....
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Old 08.05.2007, 16:24
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Re: What's just happened to the Swiss Franc?

Pesky £ is on the rise again, getting up towards its 12 month high against the Swiss Franc.

The cuurent chart for 12 months of the £ against the CHF looks like a drawing of the Alps where I'd much rather see a drawing of the Netherlands!
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