The British pound is higher against the Swiss franc on Monday.
A spokesman for the Prime Minister saying that post-Brexit EU trade talks were still continuing by telephone helped give the pound a small boost.
A tentative start to the trading week meant no big moves in haven assets like the Swiss franc.
GBP/CHF was up by 14 pips (+0.12%) to 1.1854 with a daily range of 1.1777 to 1.1904 of 3pm GMT.
The currency pair was range bound to start the week, swinging between 1.18 and 1.19. Last week it gained +3.17%.
Pound boosted by technical post-Brexit talks happening by phone
Some comments from the Prime Minister’s spokesman James Slack offered some solace to pound traders on Monday. Last week officials in the European Union had said that post-Brexit trade talks had been sidelined indefinitely.
This was something that had been priced in well in advance given it was obvious that officials would not be able to negotiate when self-isolating and when having to focus on domestic policies to fight the coronavirus. However, Slack said technical trade talks will still take place this week by phone.
Swiss franc drops as SNB sight deposits rise by most since Jan 2015
With the Swiss franc at multi-year highs and in the case of the pound at record highs, the Swiss National Bank (SNB) has started to intervene directly in foreign exchange markets. The SNB is selling Swiss francs to buy other currencies (which increases the value of its reserves) in order to push down the value of the franc.
The Latest data from SNB for the week ending March 27 show the increase in sight deposits went to CHF 620.455 billion to CHF 608.826 billion the week prior. That is a huge jump in one week and shows the Swiss central bank is getting increasingly bold in its interventions. Last week was a relatively ‘risk on’ considering the bounce in equities that saw the Dow Jones gain 21% in three days. When the market mood turns sour again, the SNB may have to sell a lot more francs, which could start to draw down their large reserve.