The Swiss franc hasn't lived up to its safe-haven reputation during the Credit Suisse collapse, as investors have sought shelter elsewhere, bringing more of a boost to the value of the gold in Switzerland's bullion vaults than to its currency.
"If it hadn't been Credit Suisse, but any other European bank getting into trouble, you would have seen the Swiss franc rising sharply because it would have been the safe haven for European risk," said Francesco Pesole, FX strategist at ING.in 2016 found that in previous crises, flows into Switzerland and the franc were driven by weaknesses elsewhere.
"The current setup doesn't argue for either of those things. U.S. bank stresses have been contained in regional banks and euro area banks have so far been relatively unscathed," said Michael Cahill, senior FX strategist at Goldman Sachs. "This would lead to an increase in domestic interest rates, thereby increasing the yield Switzerland's external liabilities pay and further weighing on the country's yield differential," Barclays FX strategists, led by Lefteris Farmakis, said.
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