Swiss central bank ceased to restrain the growth of the national currency against the euro. After the announcement of the SNB decision franc against the euro reached parity.
SNB decided to abolish the lower limit for the pair EUR / CHF at 1.20. The minimum exchange rate was established by the Swiss Central Bank in September 2011 to protect the national economy from recession and deflation, reminded Nord FX experts. Initially, the central bank warned that his ongoing currency regulation is an exceptional measure and of a temporary nature, since it is unreasonable and unacceptable in the long run.
In a statement, Thomas Jordan, the head of SNB, assured that the change in the policy of currency regulation was not panic and did not depend on the decisions taken by the central banks of other countries, as adopted under the influence of international developments. Jordan also said that the decision not to deter franc (as well as the decision itself about curbing franc) was supposed to be a surprise to market participants. Despite the rejection of rigid franc containment strengthening, the SNB intends to continue to monitor the dynamics of the national currency and to be active in the foreign exchange market, if circumstances require so.
Jordan also stated the SNB's commitment to the preservation of price stability in the medium term, while the prospects for inflation, now estimated to be low.
With respect to rates, the SNB lowered the rate to -0.75% on deposits demand. At the same time the three-month Libor rate was increased to -0.25% from -1.25%.
SNB change in currency regulation led to a rapid strengthening of the franc. Pair USD / CHF has been a rising wave of A / B level not less than Monthly2, say the experts of online trading Masterforex-V Academy. January 22, 2015 the pair remains in a downward wave A / B level, presumably, at least Monthly. Further reduction of the pair with the minimum breakdown 0.7067 will indicate the continuation of a long-term downward trend. The nearest support level is 0.5740 Fibonacci. Maximum breaking 1.0239, the pair will start rising wave A / B senior timeframe. The likelihood of resistance are the Fibonacci levels 1.0613, 1.0988. The key long-term resistance stands MF pivot 1.1730, stated Nord FX analysts (rated among the TOP Forex Brokers Masterforex-V World Academy http://www.masterforex-v.com/).
