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6 Feb 2015
Latest IMF reserve data pouring sense into SNB's activity last month – BBH
FXStreet (Barcelona) - The Brown Brothers Harriman Team shares that IMF reserve data indicates SNB reserves rose by CHF 3.3bln last month, further noting that the intervention into FX might have been around CHF 50-60bn.
Key Quotes
“The latest IMF reserve data gives some sense of the SNB's activity last month. Reserves rose by about CHF3.3 bln to CHF498.4 bln. This understates the magnitude of the intervention because of the appreciation of the franc.”
“The franc appreciated sharply following the mid-month decision to abandon the cap. The franc appreciated by 16% against the euro, which accounts about half of the SNB's reserves. It rose 8% against the dollar and 12% against sterling.”
“It is difficult to ascertain the precise amount of intervention, but it could between CHF50-60 bln.”
“A SNB member suggested last month that it may have cost the SNB CHF100 bln if it had continued to defend the cap.”
“The take away is confirmation that the abandonment of the cap did not mean that the SNB's balance sheet had reached some limit or that it has embraced a free-float of the franc. Some had speculated that the ownership structure of the SNB was the basis for the change.”
Key Quotes
“The latest IMF reserve data gives some sense of the SNB's activity last month. Reserves rose by about CHF3.3 bln to CHF498.4 bln. This understates the magnitude of the intervention because of the appreciation of the franc.”
“The franc appreciated sharply following the mid-month decision to abandon the cap. The franc appreciated by 16% against the euro, which accounts about half of the SNB's reserves. It rose 8% against the dollar and 12% against sterling.”
“It is difficult to ascertain the precise amount of intervention, but it could between CHF50-60 bln.”
“A SNB member suggested last month that it may have cost the SNB CHF100 bln if it had continued to defend the cap.”
“The take away is confirmation that the abandonment of the cap did not mean that the SNB's balance sheet had reached some limit or that it has embraced a free-float of the franc. Some had speculated that the ownership structure of the SNB was the basis for the change.”