Central bank urged to intervene against euro

A parliamentary economic commission has called on the Swiss National Bank (SNB) to set a minimum euro exchange rate at SFr1.30.

The commission said the SFr1.20 minimum exchange rate, fixed by the SNB in September, was not enough.

However the commission voted 16-6 against the idea of a package of measures to counter the strong franc, rejecting any direct political intervention for the moment.  

Its stance echoed that of Economics Minister Johann Schneider-Ammann who on Sunday said the government had no plans for a second package of measures to assist businesses struggling with the effects of the strong franc.

SNB president Philipp Hildebrand fuelled debate on possible intervention after telling the newspaper NZZ am Sonntag the franc was still overvalued. But he did not speculate on whether the bank would go so far as setting a new minimum exchange rate of SFR1.30 to the euro.

The rate was at SFr1.24 on Monday, compared with SFr1.22 on Friday.

Analysts on Monday speculated a new rate would be set, with some putting a fair exchange rate for the euro at between SFr1.30-1.40

Credit Suisse currency expert Marcus Hittinger said however such a decision would be difficult as the element of surprise would be less than in September.