Market Chaos as Swiss Franc Surges 30% In 13 Minutes, Gold Rises Sharply

Chaos was seen in financial markets today as participants were thrown a curveball when Switzerland surprised the world by removing its three-year cap on the Swiss franc, unpegging it from the euro. This sent the undervalued currency soaring and Europe’s shares and bond yields tumbling.

In just 13 minutes, from 0930 to 0952 BST, the franc collapsed by 30%. Swiss shares fell more than 12% – their largest crash since 1987. Stock markets around Europe fell with investors buying “safe haven” assets such as German bunds and gold bullion.

Gold rose in all major currencies and approached a three-month high following Switzerland’s unexpected decision to decouple its currency from the euro.

In a chaotic few minutes on markets after the SNB’s announcement, the Swiss franc jumped to a record high against the euro, rocketed nearly 30 percent in a few minutes. The franc broke past parity against the euro to trade at 0.8052 francs per euro before trimming those gains to stand at 88.00 francs – it removed the 1.20 per euro cap it has had in place since late 2011. It also gained 25 percent against the dollar to trade at 74 francs per dollar.

Gold in USD,  1 Day, January 15, 2015 – (Thomson Reuters)

The SNB ended a three-year-old policy designed to shield the economy from the euro area’s sovereign debt crisis, prevent the Swiss franc appreciating and pricing Swiss exports out of markets. The central bank lowered the interest rate on sight deposit account balances that exceed a given exemption threshold to minus 0.75 percent from minus 0.25 percent, it said in a statement today.

This is likely a coordinated move by the SNB in conjunction with the ECB in anticipation of a move against the flood of money that will likely materialise with the ECB in Frankfurt looking likely to start quantitative easing.

Gold in USD, 5 Day, January 15, 2015 – (Thomson Reuters)

Gold climbed on the news and bullion for immediate delivery increased 2.3 percent to $1,257.01 near a 12 week high, as the dollar weakened. Gold is higher for a fifth day, the longest streak since June.

The move by the SNB is a dramatic one and smells of an emergency measure. Ultra loose monetary policies are here to stay and the SNB actions suggest loose money policies will intensify in the coming months.

The revaluation of the Swiss franc versus the dollar, pound and euro is a harbinger of what will happen to those same fiat currencies versus gold in the coming months and years. The Swiss franc is one of the safest fiat currencies in the world but gold remains the ultimate safe haven asset and form of money as has been seen throughout history and in recent years.

REVIEW of 2014 – Gold Second Best Currency, +13% in EUR, +6% GBP

OUTLOOK 2015 – Uncertainty, Volatility, Possible Reset – DIVERSIFY

Today’s AM fix was USD 1,235.25, EUR 1,055.41 and GBP 811.76 per ounce.
Yesterday’s AM fix was USD 1,228.75, EUR 1,044.99 and GBP 808.76  per ounce.

Spot gold in Singapore was flat and yesterday spot gold fell $2.40 or 0.2% to $1,228.00 per ounce yesterday and silver slipped $0.18 or 1.06% to $16.83 per ounce.

GET BREAKING NEWS and UPDATES HERE

GoldCore Research

Also on news-goldcore-com

Videos

Will Silver Prices Go Up to $300?

Brent Johnson Interview-The Dollar Milkshake Theory Explained

David Morgan Silver Guru – What’s going on with silver?

Blog posts

More energy blows are dealt to Europe, causing a cold chill to be even colder

When people ask why they should invest in gold or buy silver coins, we often explain that they should do so because they are a form of insurance. Many of us are taking steps right now to protect ourselves from the impact of inflation on our day-to-day spending, others are trying to manage the increase […]

READ MORE

Will Silver Prices Go Up to $300?

This week’s guest is so bullish on silver that he’s even written a best-selling book ‘The Great Silver Bull’ where he takes an in-depth look at why silver will outperform gold once again and even go as high as $300 an ounce. Author and investments editor Peter Krauth joins Dave Russell on GoldCore TV to […]

READ MORE

Brent Johnson Interview-The Dollar Milkshake Theory Explained

“It’s the dollar strength, which brings the system down.” This week GoldCore’s Dave Russell welcomes Brent Johnson of Santiago Capital onto GoldCore TV. Brent Johnson is the CEO and founder of Santiago Capital and the man behind the Dollar Milkshake Theory. Dave’s conversation with Brent is well-worth watching as they cover US dollar strength, if […]

READ MORE

Featured

Rick Rule- Should You Invest In Gold 2022

READ MORE

Jim Rogers- The Worst Bear Market is Coming

READ MORE
Newsletter
Category
Archives
Popular

No posts available

Videos

Will Silver Prices Go Up to $300?

Brent Johnson Interview-The Dollar Milkshake Theory Explained

David Morgan Silver Guru – What’s going on with silver?

Blog posts

More energy blows are dealt to Europe, causing a cold chill to be even colder

When people ask why they should invest in gold or buy silver coins, we often explain that they should do so because they are a form of insurance. Many of us are taking steps right now to protect ourselves from the impact of inflation on our day-to-day spending, others are trying to manage the increase […]

READ MORE

Will Silver Prices Go Up to $300?

This week’s guest is so bullish on silver that he’s even written a best-selling book ‘The Great Silver Bull’ where he takes an in-depth look at why silver will outperform gold once again and even go as high as $300 an ounce. Author and investments editor Peter Krauth joins Dave Russell on GoldCore TV to […]

READ MORE

Brent Johnson Interview-The Dollar Milkshake Theory Explained

“It’s the dollar strength, which brings the system down.” This week GoldCore’s Dave Russell welcomes Brent Johnson of Santiago Capital onto GoldCore TV. Brent Johnson is the CEO and founder of Santiago Capital and the man behind the Dollar Milkshake Theory. Dave’s conversation with Brent is well-worth watching as they cover US dollar strength, if […]

READ MORE

Featured

Rick Rule- Should You Invest In Gold 2022

READ MORE

Jim Rogers- The Worst Bear Market is Coming

READ MORE