SWITZERLAND
A EUROMONEY SURVEY - MARCH 1996
BACKGROUND
From 1994 to 1995 the Swiss economy reached positive year-on-year growth rates despite the tough competition brought about by the sharp appreciation in the Swiss franc's value. The Swiss franc is one of the key parameters driving the Swiss economy. The Swiss franc is expected to stay strong and there is a good chance that the Swiss National Bank will become more expansionist in order to stimulate the desired effects on the exchange rate.
MARKET CHARACTERISTICS
The Swiss franc
In the most recent in-depth survey of foreign exchange market transactions by the Bank for International Settlements (BIS), Swiss franc spot transactions were ranked sixth both by value and turnover in currency trading worldwide. The Swiss franc was involved in 14% of all transactions carried out. Its average trading volume was $87 billion per day.
The Swiss franc's reputation as a safe haven remains unshaken. But political developments and economic conditions stimulated spot market trading among other major currencies. On the one hand, dramatically increasing volatilities among European currencies over the three years to 1995 prompted a considerably higher trading volume in the dollar, Deutschmark, yen, pound and French franc.