Tag Archive: negative interest

Weekly Sight Deposits: No SNB Interventions, Short CHF nearing records

Who has read Milton Friedman knows that the Trump reflation trade is now showing its positive side. US wages are rising by 2.5%, while inflation is still relatively low. According to Friedman, inflation will increase only later.

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Weekly Sight Deposits: Investors hedge with Swiss Franc again for the coming inflation cycle.

We explained the Trump reflation trade, where the Swiss Franc acts as the usual inflation hedge against the obviously inflationary policies of Trumpeconomics. Trump is about tax cuts โ€“ i.e. a fiscal deficit up to 10%, and about protectionism. Trump would restrict global trade and push up U.S. wages.

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Weekly Sight Deposits: Investors hedge against Trump’s inflationary policy with Swiss Franc.

We explained the Trump reflation trade, where the Swiss Franc acts as the usual inflation hedge against the obviously inflationary policies of Trumpeconomics. Trump is about tax cuts - i.e. a fiscal deficit up to 10%, and about protectionism. Trump would restrict global trade and push up wages. According to Lars Christensen Trumpeconomics is also about monetary stimulus: Trump would push for a more jobs and a dovish Fed, same as his fellow...

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SNB Sight Deposits November 7: No interventions, EUR/CHF under 1.08 with political jitters

Sight Deposits: show that the SNB has not intervened to sustain the euro, that dipped under EUR/CHF 1.08. We considered the 1.08 as line in sand for the SNB. The odds of Trump are rising. This causes fear and demand for Swiss Franc. The EUR/CHF fell to 1.0750. Speculators were net short CHF January 2015, shortly before the end of the peg, with 26K contracts. Then again in December 2015, when they expected a Fed rate hike, with 25K contracts. We see...

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Downwards and Upwards Drivers of Swiss Inflation

In the following we present the drivers of Swiss price inflation. We first present the components of the consumer price index. Then we explain which are upwards-drivers of inflation and which ones cause downwards adjustments.

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SNB’s Zurbrรผgg: No Negative Rates

Still in September, SNB's Zurbrรผgg was speaking of negative rates andย deflationary risks in Switzerland. At that meeting we told him that deflationary risks were absurd given rising M1/M3, higher salaries and strongly rising home prices . Now he admits that

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ZKB may introduce negative interest rates for ordinary savers

After UBS and CS introduced negative interest rates for big clearing accounts, ZKB changes general conditions for a potential introduction of negative rates even for ordinary savers. Time to get in contact with Geneva cash storing warehouses? More about the ZKB move on

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The Biggest Bubble of the Century is Ending: Government Bond Yields

Government bond yields under 10 years for safe-havens are close to zero. In April 2013, even 20 year bond yields are less than 3%, What can explain this bubble of the century? Update August 16, 2013: So, 10-year Treasury yields have ended the day closer to 3 per cent. But not as close as they โ€ฆ Continue reading ยป

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SNB Monetary Policy Assessment December 2012: (Nearly) Full Text

  The SNB decided to maintain the floor at 1.20 and the Libor target between 0% and 0.25%.ย As we expected in our outlook on the assessment, there were still important downwards drivers of inflation after the strong appreciation of the franc. Therefore, the SNB has moved its inflation expectations downwards for 2013 to minus 0.1% …

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How Currency Speculators Help the SNB to Fight against Ordinary Investors

A discussion in the investor forum made clear how currency speculators currently help the SNB to maintain the floor against normal investors. A situation that was different in August/September 2011, when the SNB had to fight against these speculators.   A discussion in the investor forum Seeking Alpha:ย part one   Based on our analysis of …

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Credit Suisse and UBS Will Charge Negative Interests Above a Threshold

Credit Suisse and UBS will charge negative interests for cash clearing clients above a threshold. Last year such was worth 150 bps, this year on 28 bps.ย ย See the official news at FT Alphaville

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Gold, CHF, Brent Arbitrage Trading after Negative CS, UBS Interest Rates

  Credit Suisse and UBS will charge negative interests for cash clearing clients above a threshold. Last year such news was worth 250 bps, on December 3 only 28 bips. One remembers August 26, 2011, when UBS only spoke of negative interests and consequently EUR/CHF rose from 1.1420 to 1.1688. At the time FX traders …

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How former central bankers stepped up against the central banks

There are already three former European central bankers who criticize more or less openly the European Central Bank (ECB).

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The Swiss National Bank and the EUR/CHF floor have become a political football

  How the SNB Chairman Jordan has invited hedge funds and smart investors to a risk-free, high-return guaranteedย investment in Swiss francs A wrap-up of Swiss newspapers for non-German literates In parallel to the start of the UEFA Euro 2012, the Swiss National Bank and its policy towards the EUR/CHF exchange rate has become a political …

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CNBC rumors: Different peg methods for the SNB

There are currently rumors going on on CNBC that the SNB is planning something this night. As we explained here, the SNB had to strongly restart the printing press and printed tremendous 13 bln francs in one week. Moreover, they probably sold some of their in Q4 2011 and Q1 2012 acquired GBP, JYP and …

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Rumors about tax on Swiss deposits for foreigners and further SNB measures: SNB begging for pips

Exactly when the US had a relatively good Markit Flash PMI, rumors are sent out that deposits in CHF for foreigners should be taxed. ย To send out this rumor together with good US data seems to be intentional. According to Banque CIC the SNB has declined to comment.ย We remember the lastย SNB meetingย when similar rumors circulated.

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Former SNB chief economist: Capital controls are just empty words

A former SNB chief economist says that capital controls are impossible, just empty words. In case of a Euro break-up the Swissie must rise together with USD, GBP and JPYย  An article, surprisingly from the usually left-wingย Tagesanzeiger, more or less closely translated with some additional remarks.

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EUR/CHF, A History, The Game Changes: April 2012

EUR/GBP: If You Want To Know Why Its Falling, Have A Look At The SNB Thanks Goose for the reminder that theย SNB released figures on its FX reserves holdingsย and these showed a marked increase in GBP holdings. This has been a constant theme over the last few weeks/months, the SNB buys EUR/CHF in the marketplace … Continue reading »

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EUR/CHF, Market betting on Floor Hike, December 2011

Four Trades For 2012: #2 Sell The Swiss Franc I bought EUR/CHF shortly after the 1.20 peg was introduced and have held it ever since. My only regret has not been trading the range more aggressively. At this point everyone has an opinion of the SNB so I wonโ€™t try to convince the bears. Personally, … Continue reading »

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