SNB sells forex worth CHF132.9b in ’23

The Swiss National Bank (SNB) sold foreign currency totalling 132.9 billion Swiss francs ($149.51 billion) in 2023, demonstrating a heightened commitment to bolstering the Swiss franc as a defence against imported inflation, Reuters reported on Tuesday.

This amount represents a substantial increase from the 22.3 billion francs in foreign currencies sold by the SNB in 2022 when it began divesting some of its extensive foreign currency reserves.

The SNB’s strategy has yielded positive results, with Swiss inflation remaining within its target range of 0-2 per cent for the past nine months.

According to the SNB, “The foreign currency sales conducted by the SNB initially led to the Swiss franc appreciating in tandem with inflation differentials against other nations. This action prevented a real-term depreciation of the Swiss franc and thereby contributed to tightening monetary conditions. Towards the end of the year, the inflation rate saw a significant decline.”

Having achieved its objective, the SNB stated that it would no longer prioritize foreign currency sales. The central bank is scheduled to announce its upcoming monetary policy decisions on Thursday.