The Swiss Central Bank should Diversify its FX Reserves

Introduction

There is plenty for central banks to worry about right now. Not least rising inflation and a potential recession that could rock almost every country and leave central banks cutting interest rates right back to where they were. Traditionally, central banks have adjusted the level of interest rates to achieve their mandates and support acceptable levels of economic activity. The Swiss central bank like other central banks went further and cut interest rates to negative territory after the 2008 GFC, until recently when it…