* Weekly sight deposit increase highest since March 2017
* SNB FX interventions last week could be more than in all of 2018
* Switzerland likely meets currency manipulator status
ZURICH, March 16 (Reuters) - The Swiss National Bank has lifted its currency market interventions to their highest level in more than three years, data indicated on Monday, as the central bank battles against the rising value of the safe-haven Swiss franc.
Total sight deposits, money that commercial banks park with the SNB overnight, increased to 602.992 billion Swiss francs ($640.05 billion) from 598.548 billion francs in the previous week.
The 4.4 billion franc increase is the biggest since March 3 2017, and far more than the “modest” 2.3 billion Swiss francs ($2.32 billion) the SNB spent during the whole of 2018.
The increase shows how seriously the SNB is taking the current market turbulence caused by the coronavirus pandemic and its determination to check the franc’s rise in recent weeks.
The Swiss currency has risen to its highest level against the euro in 4-1/2 years as investors have sought less risky assets to offset stock market losses.
“The SNB is clearly in the market, and I would expect the amount of interventions to rise in the future as the SNB tries to reduce demand for the franc,” said Maxime Botteron, an economist at Credit Suisse.
The SNB, which is due to give its next monetary policy update on March 19, declined to comment on the increase in sight deposits.
Botteron calculated the SNB has spent around 18 billion francs since the beginning of the year on currency interventions. That would exceed the U.S. Treasury’s 2% of GDP limit and mean Switzerland passes all three of its criteria to be labelled a currency manipulator.
That is a risk the SNB is prepared to take as the coronavirus adds to pressure on the currency, Botteron added.
Increases in sight deposits can be a proxy for SNB foreign currency interventions as the central bank credits the accounts of the commercial banks with newly-created Swiss francs in exchange for foreign currency.
Interventions have been one of two planks of SNB policy over the last five years, along with a policy interest rate of minus 0.75%, the lowest in the world.
$1 = 0.9421 Swiss francs Reporting by John Revill; Editing by Catherine Evans
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