While the move caused tumult in the financial markets, it will be a boon to Swiss consumers. An item priced at 50 euros in Brussels would suddenly cost 51 francs in Davos on Jan. 15 after costing 60 francs on Jan. 14.
From a more strategic viewpoint, the Swiss bank defended its currency against a likely European Central Bank move that will see a massive bond-buying program likely to devalue the euro further. Nomura Securities economists speculated that the Swiss move was a signal that the ECB’s quantitative easing program would exceed market expectations.
In the face of that, the SNB decided it no longer could stand by and let its own currency decline any further.
For consumers in Switzerland, it meant cheaper goods, but for an economy that relies on exports, it made life more difficult for companies.
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