SNB unofficially targeting 1.05-1.10 francs per euro

The Swiss National Bank, which last month scrapped the cap it had imposed on the value of the franc, is unofficially targeting an exchange rate of 1.05-1.10 francs per euro, a Swiss newspaper reported on Sunday, citing sources close to the bank. A spokesman for the central bank declined to comment on the story, published in the Schweiz am Sonntag newspaper.
Citing unnamed sources close to the bank, the paper said the SNB was operating "a kind of minimum exchange rate against the euro".
"The talk is of a 'corridor' from 1.05 francs to 1.10 francs," the paper said. It also cited a well-informed source as saying the bank would incur losses of up to 10 billion francs, without giving a timeframe.
The SNB's January 15 announcement that it had scrapped its cap of 1.20 francs to the euro - the centrepiece of its monetary policy since September 2011 - unleashed a surge in the value of the currency.
After the initial shock, which took it below 0.90 francs per euro, the currency has retreated back to 1.0374 francs, a level still widely seen as strong enough to force Switzerland into recession.
Three days after his shock policy announcement, SNB President Thomas Jordan was asked in a newspaper interview if the bank could bring the policy back in another form.
"We take account of exchange rates as a whole. And if the need arises, we will be active in the foreign exchange market," he said at the time.