The Swiss National Bank held its target for the 3-month franc LIBOR unchanged at 0-0.25 percent, and reaffirmed its commitment to the EURCHF 1.20 floor set on the 6th of September. The Bank said it "will continue to enforce the minimum exchange rate of CHF 1.20 per euro with the utmost determination. It is prepared to buy foreign currency in unlimited quantities... Even at the current rate, the Swiss franc is still high and should continue to weaken over time. The SNB stands ready to take further measures at any time if the economic outlook and the risk of deflation so require."
The SNB intensified its currency measures over the past two months. Switzerland reported annual consumer price inflation of -0.5% in November, down from 0.2% in August, compared to 0.50% in July, meanwhile, the Bank is forecasting inflation of 0.4% during 2011, while 2012 inflation is expected at -0.3% and 0.5% in 2013. The Swiss economy grew 1.3% on an annual basis in the September quarter (2.3% in Q2 and 2.5% in Q1). The Swiss franc (CHF) last traded around 1.22 against the Euro, and 0.94 against the US dollar.