The Swiss Give the Reins to Gold as the Safe Haven Currency
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The Japanese don't want it, the U.S. doesn't want it, and now the Swiss don't want it either. Gold on the other hand is happy to take the reins.
Switzerland's National Bank sent shock waves through the market Tuesday after sending a clear and deliberate message to the world that it doesn't want to be the de facto safe haven currency due to the threat it poses to its fragile economy.
The country's central bank said "it will no longer tolerate a EUR/CHF exchange rate below the minimum rate of CHF 1.20." The body said it is "prepared to buy foreign currency in unlimited quantities" to enforce this.
For months and months, traders have been running to the Swiss franc amid the worldwide turmoil.
With the Swiss stepping down as the world's safe haven currency, gold is now the de facto safe haven currency.
Gold of course doesn't have a central bank that can devalue it at will.
Speculators are buying gold in force Tuesday and it has again regained the $1,900 level. Gold last traded up $25.10 to $1,902. ETF SPDR Gold shares (NYSE: GLD) are up 0.8 percent to $184.78 after tapping an all-time high earlier in the session.
Switzerland's National Bank sent shock waves through the market Tuesday after sending a clear and deliberate message to the world that it doesn't want to be the de facto safe haven currency due to the threat it poses to its fragile economy.
The country's central bank said "it will no longer tolerate a EUR/CHF exchange rate below the minimum rate of CHF 1.20." The body said it is "prepared to buy foreign currency in unlimited quantities" to enforce this.
For months and months, traders have been running to the Swiss franc amid the worldwide turmoil.
With the Swiss stepping down as the world's safe haven currency, gold is now the de facto safe haven currency.
Gold of course doesn't have a central bank that can devalue it at will.
Speculators are buying gold in force Tuesday and it has again regained the $1,900 level. Gold last traded up $25.10 to $1,902. ETF SPDR Gold shares (NYSE: GLD) are up 0.8 percent to $184.78 after tapping an all-time high earlier in the session.
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