SNB decision shocked the market (COMMENTS) – Pulse of Business

SNB decision shocked the market (COMMENTS) – Pulse of Business

Here’s how to comment on the decision of the SNB some investors and analysts on a blog published by “The Wall Street Journal”:

Luke Bartholomew, investment manager at Aberdeen Asset Management:

“It is a great move by the SNB. The problem is that Switzerland is all too regarded as a safe haven. People desperately want to have a currency that would protect them from danger. They do not see that option in the case of the Eurozone. Taking into account the perspective of quantitative easing by the ECB in the next week, the SNB had to recognize that the current limit is not tenable. Instead, it has a lower interest rate. “

Alex Dryden, strategist at JP Morgan Asset Management:

“The SNB’s decision deepens Swiss experiment with unconventional monetary policy. Only a few weeks ago, the SNB has set the first negative deposit rate since 1970, and now abandoned a fixed exchange rate of 1.20 for EUR / CHF. The SNB has hope that it will discourage investors to perceive the franc as a safe haven. This decision can add to the growing list of changes that result in increased volatility and uncertainty in global financial markets in the first weeks of 2015 “.

Vasileios Gkionakis, currency strategist UniCredit:

“This is a very surprising move by the SNB, especially in view of the risk for the euro area because of the elections in Greece. In the medium term, I’m afraid the impact of measures taken, such drastic decisions on the credibility of the SNB, change the language was very violent. “

Kit Juckes, macro strategist at Societe Generale:

“It’s a complete surprise. Although the environment (elections in Greece, the sanctions imposed on Russia and quantitative easing ECB) continues to exert enormous pressure on the limit, the SNB decision should be considered as a huge surprise. In establishing such a deeply negative interest rates SNB must believe that the jump EUR / CHF will be short-lived, and we can hope to see some kind of intervention. “

Adam Myers, strategist at Credit Agricole:

“The decision of the Swiss National Bank is associated with a significant speculative pressure next week’s ECB meeting pre-emptive. Given the volume of traffic on a pair EUR / CHF, it seems that the size of speculative option positions against the Swiss franc was much higher than suggested by available data. “

Simon Derrick, chief strategist at BNY Mellon:

“This suggests that the SNB or assumed severity of the Russian crisis, or more, more likely, that in his view the program of quantitative easing by the ECB is inevitable.”

Michael Saunders, economist at Citigroup:

“The Swiss economy is still stuck in the low inflation – or even deflation. Low, negative rates are intended to provide a counterweight to the strengthening of the franc. But so far, the overall effect today decision is completely the opposite. The effects of the appreciation of the stimuli significantly exceed the rate cut. If this appreciation in the currency market continues, the SNB is likely to cut interest rates deeper into negative territory. “