Franc Considered Overvalued Even Pegged to Euro
The Swiss franc fell today against most major currencies as Economy Minister Johann
Minister explained what he thinks the fair rate for the franc is:
There is a general understanding that
purchasing-powerparity is around 1.35 to 1.40 francs per euro. That’s pretty much accepted.
According to the index of the Organization for Economic Cooperation and Development, the Swiss currency is still 35 percent above the adequate price versus the euro.
The euro fell today on concerns about the debt crisis in the region, but the peg of the franc to the European currency hasn’t allowed the Swissie to profit from the resulting demand for a haven. Still, the Swiss currency rose versus the euro, nearing to the ceiling set by the Swiss National Bank.
USD/CHF closed today at 0.8835 after opening at 0.8754 and falling to 0.8706. CHF/JPY fell from 88.49 to 87.75. EUR/CHF closed at 1.2065, declining from the opening rate of 1.2151.
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Earlier News About the Swiss Franc:
- Record Drop of Franc After SNB Pegs Currency to Euro (2011-09-06)
- Franc Jumps as US Payrolls Show Zero Growth (2011-09-02)
- Franc Rallies as SNB Doesn't Intervene (2011-09-01)
- Franc Falls as Bernanke Improves Sentiment on Markets (2011-08-26)
- Franc Gains as Markets Return to Risk Aversion (2011-08-24)