ZURICH (Reuters) - The Swiss National Bank (SNB) is ready to use its available policy tools to stem any upward pressure on the Swiss franc that might result from France’s presidential elections, SNB Chairman Thomas Jordan said in an interview with Bloomberg TV.
“We hope that a reasonable candidate can win — somebody who is in favour of free markets — but we cannot exclude that there will be more pressure on the Swiss franc,” Jordan said on the sidelines of an International Monetary Fund meeting in Washington, D.C. on Saturday. “But as you know we also have our instruments to react to such a situation.”
The SNB has been using negative interest rates and currency intervention to try to keep a lid on the franc, whose strength against the euro weighs on the export-led Swiss economy.
The latest data on sight deposits at the central bank, a proxy for currency interventions, showed the SNB has continued to sell francs ahead of the French presidential elections, which started on Sunday.
Alongside the intervention in the foreign exchange market, the SNB also still has “more leverage” on interest rates, Jordan said.
Jordan also said the SNB was in “no hurry at all” to normalise monetary policy and planned to maintain its expansionary policy as long as necessary to maintain appropriate monetary conditions in Switzerland.
Reporting by Brenna Hughes Neghaiwi. Editing by Jane Merriman