Swiss National Bank Cuts 50bp as Policymakers Lower Forecasts for Growth and Inflation

Daily Forex Fundamentals | Written by DailyFX | Dec 11 08 08:55 GMT |

The SNB has cut its target range for the 3 months Libor by 50 bps to 0.00-1.00%. The move was widely expected and brings the mid point of the range to just 0.5%, very close to zero. The central bank has reacted swiftly and decisively to the threat of a protracted economy slowdown and we could well see rates go down to zero next year and the SNB resorting to quantitative easing. Meanwhile, Swiss Franc (CHF) dipped after SNB cut rates by 50 bp, which was widely expected, leaving the 3-month Libor target rate at 0.00-1.00%. The SNB cited deterioration in the intonation environment, citing a decline in the U.S. and European economies, which are strongly impacting the Swiss economy. EUR/CHF is expected to push above 1.5650, although offers expected to be heavily congested around this area, given that the 100-day moving average lies at 1.5640. USD/CHF has found a modicum of support from 1.1900 since the SNB decision, but risk is on the downside for this pairing, with the technical changing working against the dollar amid the losses seen over the last few sessions. Nevertheless, equity markets are likely to driven sentiment, with technical studies lacking reliability in the current choppy trading environment. DailyFX Disclaimer Investment in the currency exchange is highly speculative and should only be done with risk capital. Prices rise and fall and past performance is no assurance of future performance. This website is an information site only. Accordingly we make no warranties or guarantees in respect of the content. The publications herein do not take into account the investment objectives, financial situation or particular needs of any particular person. Investors should obtain individual financial advice based on their own particular circumstances before making an investment decision on the basis of the recommendations in this website. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. All intellectual property rights are the property of Daily FX. Daily FX and its affiliates, will not be held responsible for the reliability or accuracy of the information available on this site. The content herein is provided in good faith and believed to be accurate, however, there are no explicit or implicit warranties of accuracy or timeliness made by Daily FX or its affiliates. The reader agrees not to hold Daily FX or any of its affiliates liable for decisions that are based on information from this website. Daily FX highly recommends that before making a decision, the reader collects several opinions related to the decision and verifies facts from at least several independent sources.