Swiss National Bank Reports Q2 Loss of 2 Billion Swiss Francs Due to Stronger Currency
The Swiss National Bank (SNB) reports a Q2 loss of 2 billion francs, impacted by the rising Swiss franc’s effect on foreign currency investments despite gains in gold and equity portfolios.
Bollywood Fever: The Swiss National Bank (SNB) announced a loss of 2 billion Swiss francs ($2.27 billion) for the second quarter, primarily due to the rising value of the Swiss franc which diminished gains from foreign currency investments. This result contrasts sharply with the first quarter’s profit of 58.8 billion francs, despite valuation gains in the SNB’s gold and equity portfolios.
During the quarter, the SNB reported a 3.26-billion-franc gain from the increased value of its 1,040 tonnes of gold, driven by global political tensions boosting the price of the precious metal. However, its foreign currency positions, comprising 740 billion francs in stocks and bonds, recorded a loss of 3.10 billion francs. The higher value of the Swiss franc and lower bond prices negated gains from rising global equity markets.
Additionally, the SNB incurred a loss of 2.06 billion francs on its Swiss franc positions, mainly due to interest payments on sight deposits to commercial banks.
Despite the loss, the SNB’s primary mandate is price stability rather than profit generation. “The SNB’s financial result depends largely on developments in the gold, foreign exchange and capital markets,” the central bank stated. “Strong fluctuations are therefore to be expected.”
UBS economist Florian Germanier noted that the strengthening Swiss franc could continue to impact the SNB’s results in the coming months. “We expect the franc to strengthen as other central banks cut rates and because of geopolitical tensions adding to the safe haven flows into the currency, which is a significant risk for the SNB’s results for the rest of the year,” he said.
Also Read other news articles, GSK Raises Annual Forecasts Despite Weak Vaccine Sales and Outlook
Mempool.space Unveils New Bitcoin Transaction Accelerator in Collaboration with Major Mining Pools
University of Wyoming Establishes Bitcoin Research Institute to Advance Scholarly Understanding
