ZURICH, June 24 (Reuters) - Switzerland’s central bank on Friday gave rare confirmation that it had intervened in the currency market to weaken the Swiss franc in the wake of Britain’s vote to leave the European Union.
On the back of the unexpected Leave vote, the safe-haven franc rose to its highest level against the euro since August 2015 and had its biggest one-day jump since the Swiss National Bank removed its franc peg to the euro on Jan. 15, 2015.
In a sign of the SNB’s actions, the euro steadily rose from a low of 1.0623 to around 1.0790 francs in early London trade.
“Following the United Kingdom’s vote to leave the European Union, the Swiss franc came under upward pressure,” the SNB said in a statement. “The Swiss National Bank has intervened in the foreign exchange market to stabilise the situation and will remain active in that market.”
The SNB normally declines to comment on whether or not it has been active in the currency market but has occasionally given confirmation in the past, most recently in June last year amid uncertainty over Greece’s financial future.
Last week, SNB officials said it would counter any surge in an already overvalued franc should Britain vote to leave the EU, leaving open the option to cut record-low rates deeper into negative territory.
Global financial markets plunged as complete results showed a near 52-48 percent split for leaving, sparking fears the decision will hit investment in the world’s fifth-largest economy, threaten London’s role as a global financial capital and foment uncertainty in the world’s biggest trading bloc. (Reporting by Joshua Franklin; Editing by Michael Shields)
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