Jim O’Neill, chairman of Goldman Sachs Asset Management, has abandoned his forecast that the Swiss National Bank will take further actions to weaken the franc.
Mr. O’Neill previously predicted the SNB would raise its self-imposed floor for the euro from CHF1.20 to CHF1.25 this year as the strength of the franc undermined the nation’s growth outlook.
Yet the euro zone’s sovereign-debt crisis, which has escalated after a brief reprieve earlier this year, has fueled a continued flight out of euros into the franc, requiring the SNB to intervene aggressively. Over the past few months, the euro has hovered around the CHF1.20 level and at times briefly dropped below that limit.
“I think the target would stay where it is for the rest of the year,” said Mr. O’Neill in a phone interview Wednesday from his office in London. “Politics [have] become a lot more complicated” following the departure earlier this year of Philipp Hildebrand as the head of the Swiss central bank even as the economic factors to weaken the yen haven’t changed, he added.
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