Moser highlights role of Swiss pension funds in SNB move
Conservative asset allocation strategies of Swiss pension funds have played an important role in the Swiss National Bank’s (SNB)) decision to abandon the fixed exchange rate between euro and franc, according to SNB board member Dewet Moser.
Speaking at the general meeting of the Swiss pension fund association ASIP, Moser said: “the structural appreciation pressure on the Swiss franc was not just caused by foreign investors, as a look on our balance of payments illustrates. The outbreak of the financial crisis has turned around private capital flows in Switzerland.”
Moser argued that the reduced risk appetite among Swiss investors and the increased repatriation of assets held abroad has increased the pressure on the Swiss currency.
Moser also warned that the negative deposit rates introduced by the Swiss central bank could amount annual extra costs of CHF400m for Swiss pension funds. At the same time, he also suggested that a further downward movement of deposit rates is unlikely.