Still, the SNB said it is keeping a close watch on the June 23 referendum in the United Kingdom on its membership in the European Union, and is ready to take steps to offset any turbulence.
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“As a small open economy, Switzerland is highly exposed to developments overseas”, Thomas Jordan told reporters following the Swiss National Bank’s quarterly policy meeting.
The Swiss franc, long considered a safe haven currency, has already seen its value surge since the publication at the weekend of polls suggesting the so-called Brexit could win the day in the June 23 vote.
The Swiss National Bank is set to keep its deposit rate unchanged at a record low of minus 0.75 percent on Thursday as policy makers conserve ammunition ahead of a United Kingdom vote on European Union membership.
Credit Suisse and UBS need additional going-concern capital amounting to roughly 10 billion francs (S$14.06 billion) each, the SNB said, referring to higher-quality debt instruments that count toward the leverage ratio.
SNB President Thomas Jordan said that Swiss policy makers are watching the United Kingdom developments closely, and will respond if needed.
As expected, the Swiss National Bank (SNB) left monetary policy on hold at the latest policy meeting with the middle of the target range for 3-month Libor remaining at -0.75%.
The two banks present a bigger risk to their local economy than their peers elsewhere because their combined assets of 1.78 trillion francs amount to nearly three times Switzerland’s gross domestic product.
“With the recent market turbulence, it’s very likely that the SNB has grown more aggressive with its intervention”.
At 3:30 am ET Thursday, the Swiss National Bank’s interest rate announcement is due. It also maintained a charge on cash deposits of 0.75 percent.
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There was little immediate market reaction to the rate decision. But now expects a return to a slight inflation of 0.3 percent in 2017, up from the 0.1 percent previously predicted.
