Swiss National Bank’s Jordan: euro-franc parity not economically important

ZURICH (Reuters) -The Swiss Nationwide Financial institution believes the Swiss franc’s rise above parity versus the euro is unlikely to have a major influence economically, Chairman Thomas Jordan mentioned in an interview broadcast on Saturday.

The Swiss forex has surged as traders have sought safe-haven property throughout the Ukraine conflict. It rose above 1 franc to 1 euro earlier this month earlier than weakening to round 1.02 francs to the euro. A yr in the past, a euro purchased 1.10 francs.

“From an financial perspective, it isn’t bought an enormous significance,” Jordan advised Swiss radio station SRF when requested if the franc rising above parity was a stage the central financial institution would combat.

“We do not give any forecasts the place the alternate charge will go, however what’s essential is we do not simply have a look at the euro however all currencies collectively…and in addition the inflation variations, that is essential.”

Greater inflation exterior Switzerland had decreased the influence of the stronger franc, he mentioned, with Swiss companies typically coping nicely with the forex’s larger valuation.

Swiss inflation has picked as much as 2.2%, its highest stage since 2008, however stays low in comparison with america and Europe, Jordan mentioned.

The SNB caught to its expansive financial coverage in its newest replace on Thursday, holding rates of interest locked at minus 0.75%, however doubled its inflation forecast for this yr.

The central financial institution would proceed to observe inflation intently, Jordan mentioned, and in addition monitor the developments within the alternate charge.

“The franc stays extremely valued…and it’s the motive why we stay prepared, when vital, to intervene on the forex markets to stop the franc changing into too robust,” Jordan mentioned.

(Reporting by John Revill; enhancing by Barbara Lewis and Christina Fincher)