Swiss central bank increases money supply
The Swiss National Bank said it is pumping more Swiss francs into the market to combat the currency’s “massive overvaluation” against the US dollar and the euro.
The central bank said it will achieve this by raising overdrafts for commercial banks to 120bn Swiss francs (€115.2bn) from 80bn francs (€76.7bn).
The SNB said it will also conduct foreign exchange swap transactions to ease the value of the franc, which has been buoyed by its status as a safe haven asset for investors to park their cash during the current volatility in financial markets.
Today’s announcement came after the franc almost reached parity with the euro overnight.
The SNB it would take further measures “if necessary”.
