Rather surprisingly, the Swiss National Bank (SNB) has announced the introduction of negative interest rates on Thursday morning. Obviously, the SNB came to the conclusion that the minimum rate of CHF 1.20 left to defend only difficult to € without these unconventional measures. To write the monetary authorities, in the last few days, various factors have led to a greater demand for safe assets. The introduction of negative interest rates make holding Swiss franc investments less attractive and thus support the minimum price.
suffering from the euro-zone
The move comes not least surprising because the SNB only recently week period had invited the media to monetary policy assessment and had then voted yet for maintaining the current course. Apparently, the paragraph moves towards Franconia seem to have increased further since ever since. That did not last to do with the ongoing difficulties in the euro zone and the aggravation of geopolitical tensions. Is added that the European Central Bank (ECB) increasingly louder think about a program for purchase of government bonds, which also amounts to a weakening of the euro. Shifts in the dollar area where, given the medium term rising interest rates waving higher returns seem to have the pressure on the franc weakened only slightly.
allowance of 10 million Mrs.
new measure provides that the SNB will weigh from 22 January 2015 balances on their current accounts with an interest in the amount of 0.25%, and that until further notice. Thus it seeks to push the three-month Libor into negative territory. Consequently, the target range for the three-month Libor has been corrected to a range between -0.75% and 0.25% on Thursday to bottom. The negative interest is levied on balances that exceed a certain allowance. Per account holder, that limit is at least 10 million Fr .. excluded the credit of the federal government, federal companies close and domestic authorities remain of the measure.
The question now is how commercial banks will react to the SNB move , They may enter the negative interest rates, at least on the big customers. In Germany, the institutes have certainly requires high short-term deposits of corporate clients negative interest or penalty interest after the ECB had introduced an interest rate of 0.2% on money that is parked at her overnight. More caution should be exercised against the Swiss banks on private customers. You will want this little upset. However, savers could be affected in a different form of the negative interest rates of the SNB, if the institutions charge higher fees than reaction in one form or another.
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