The Swiss franc weakened against other currencies and stocks gained after the central bank cut its policy rate by 25 basis points to 1.25%, as expected by two-thirds of analysts polled by Reuters, following a quarter-point reduction in March.
The Swiss Franc is unlike any currency in the world because it’s considered a HAVEN currency. The PROPERTY RIGHTS in Switzerland are the best in the world, and even their national currency is a reflection of that. Unlike say a country like Canada, which similar to Switzerland has a robust PRIVATE banking climate, however Canada’s FISCAL policies, as well as Canada’s views, are property rights, has forced itself into raising rates to 4.75%.
Switzerland never reached 4%, whereas Canada reached 5%, and this is something to observe, even in Europe, in which a lot of European nations who use the Euro if they were to exist without the Euro, would likely find themselves in hyperinflationary scenarios.
Property Rights in Switzerland are reflected in their democratic system, which revolves around the U.S. Constitution, the difference being that the Swiss haven’t allowed their Federal government to dominate the topic of PROPERTY RIGHTS in their nation.
In America, the federal government has grown into a monster, and the only thing the U.S. has together is the perceived international value of the U.S. dollar. Although the U.S. has its share of problems, the U.S. dollar has taken on a mind of its own, so domestically, the U.S. dollar buys a lot less, but internationally, the U.S. dollar has maintained its purchasing power.
The Swiss worry about EXPORTS, so their central bank often monitors the strength of their currency in the foreign exchange markets, and this is why they’ve likely lowered the interest rates.
