EconomicReason

Swiss finance minister Hans-Rudolf Merz rules out that UBS would ever get an emergency state guarantee.

Under normal circumstances, there is no compelling reason that EURCHF and the Shanghai Composite Index should be correlated. Under normal circumstances, the correlation shown in the figure below could thus be dismissed as so-called “spurious correlation“.
However, circumstances are probably not normal. Both depicted variables might be driven by speculation and might therefore be caused by the same phenomenon: […]

At 1.64 CHF per Euro, the Swiss franc trades at a new multi-year low (see also my recent post).
The reasons are low Swiss interest rates, low perceived exchange rate risk and a high international risk appetite, all of which encourage speculators of all kinds to use the Swiss Franc as a cheap funding currency, above all hedge […]

Swiss National Bank chairman Roth held a speech yesterday on the role of housing prices in Swiss monetary policy (unfortunately only available in German). Switzerland probably is, apart from Germany and Japan, the only country in the industrial world which does not currently experience a countrywide housing bubble, although there are quite a few local bubbles brewing in […]

The Swiss Franc is at an all-time low against the Euro and is now toying with 1.62 CHF/EUR, after having taken the hurdle of 1.60 CHF/EUR only a few weeks ago. Due to the lower inflation rate in Switzerland as compared to Europe, in real terms, the Swiss franc is even cheaper than indicated by nominal exchange rates: against […]

The Swiss just found out that there is an “electric power gap” looming after 2012. On the one hand, electric power demand is expected to grow further, while on the other hand, electric power supply is expected to drop sharply due to the Swiss nuclear power stations reaching their age limit and long-term supply agreements with France running […]

In yesterday’s speech at the ECB conference on the role of money in monetary policy, Philipp M Hildebrand, member of the Governing Board of the Swiss National Bank, concluded:
In the case of the SNB, the flexible nature of the policy framework and the importance attached to money and credit variables means that in an effort […]