Weakness in Swiss Franc Awakens Bullish Spirits
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Recently the value of the Swiss franc, which in 2012 was supported by the Swiss National Bank, ramped higher. The change is reflecting in the value of the EUR/CHF, which now stands at 1.2380. This is significantly higher than SNB’s 1.20 floor, and may signal an inflection point for both the euro and the global economy.
In a recent interview on Bloomberg TV, Jim O'Neill, chairman of Goldman Sachs Asset Management said, "I think the decline of the franc is showing there is growing more retail confidence maybe that the European situation is stabilizing in a stronger way than perhaps many people talk about, otherwise it would be hard to understand the franc move"
Weakness in the Swiss Franc may also signal the end of risk aversion, a positive for the global economy and investing.
"Of course more broadly, the franc for the whole of my career--over 30-odd years if not longer--plays this critical role of being the true test of global risk aversion," said O’Neill. "The fact that the franc weakening so much in the short space is another sign on top of others that we're seeing a bit of a rotation of investor psychology about the whole fragility of the world or less fragility."
In a recent interview on Bloomberg TV, Jim O'Neill, chairman of Goldman Sachs Asset Management said, "I think the decline of the franc is showing there is growing more retail confidence maybe that the European situation is stabilizing in a stronger way than perhaps many people talk about, otherwise it would be hard to understand the franc move"
Weakness in the Swiss Franc may also signal the end of risk aversion, a positive for the global economy and investing.
"Of course more broadly, the franc for the whole of my career--over 30-odd years if not longer--plays this critical role of being the true test of global risk aversion," said O’Neill. "The fact that the franc weakening so much in the short space is another sign on top of others that we're seeing a bit of a rotation of investor psychology about the whole fragility of the world or less fragility."
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