Swiss Franc Falls After SNB's Jordan Warns On Gold Initiative
00:37, 24th November 2014
(RTTNews) - The Swiss franc weakened against the other major currencies in the Asian session on Monday after Swiss National Bank President Thomas Jordan warned concerning proposals to boost the gold reserves of the central bank.
Speaking at a church in Uster near Zurich, Switzerland on Sunday, Jordan said that the gold initiative is dangerous as it would restrict the monetary policy room for manoeuvre.
If the "Save Our Swiss Gold" initiative is adopted, it would force the SNB to buy gold for each euro it purchases to weaken the franc, would make it considerably harder for us to intervene with determination in a crisis situation and fulfill our stability mandate, Jordan said.
Switzerland holds a national referendum on Nov. 30 that could force the SNB to increase its foreign reserve allocation to gold, at least 20 percent, up from the current 8 percent.
The voters who support this initiative have slipped than the majority, a poll published last week showed.
Last Friday, the Swiss franc fell 0.13 percent against the euro, 0.88 percent against the pound, 1.07 percent against the U.S. dollar and 1.50 percent against the yen.
In the Asian trading, the Swiss franc fell further to near a 3-week low of 0.9727 against the U.S. dollar and near a 2-week low of 1.5215 against the pound, from last week's closing quotes of 0.9696 and 1.5178, respectively. If the franc extends its downtrend, it is likely to find support around 0.975 against the greenback and 1.54 against the pound.
Against the yen, the franc slipped to a 6-day low of 121.05 from last week's closing quote of 121.42. The franc is likely to find support around the 119.78 region.
The franc edged down to 1.2030 against the euro, from last week's closing quote of 1.2013. On the downside, 1.206 is seen as the next support level for the franc.
Looking ahead, German Ifo business climate index for November is due in the European session.
In the New York session, the European Central Bank is due to announce data on covered-bond purchase. Additionally, Markit is scheduled to announce the results of its U.S. service sector survey for November.
Copyright(c) 2024 RTTNews.com, Inc. All Rights Reserved