Swiss Franc Slips as SNB Warns Markets

By: Barbara Zigah

The Swiss Franc remains under some pressure following interventionist comments made by the Swiss National Bank. A spokesperson said that they are considering resetting the safe haven currency, which is currently pegged to the Euro at a rate of 1.20 Swiss Francs, in an effort to prevent the currency’s appreciation. Following the threat, the Euro extended its gain against the Swissie, trading up 0.3% to 1.2427 Swiss Francs. The U.S. Dollar also climbed higher against the Swiss Francs, trading at 0.9042 Swiss Francs, the highest in nearly three weeks.

In the absence of the Swiss Franc, the Euro was hard-pressed to find any traction with the events of the Eurozone pushing uncertainty to new heights. As reported at 12:30 p.m. (JST) in Tokyo, the Euro was trading at $1.3758, a slight drop from late New York trading of $1.3773. More recently, the EUR/USD pair was trading down at $1.3747. Analysts say the outlook remains gloomy for the Euro, given the ever-evolving crises. Today, the Italian Parliament will vote on a proposed budget plan, the outcome uncertain and dependent on whether or not Prime Minister Berlusconi can muster enough votes even within his own party to push the bill through. Markets remain hopeful that the current Italian government will be ousted, however.