Bored? We know you are. Nothing’s happening, and making something happen is all of a sudden frowned upon. Even God’s own chosen bankers can’t find a trade to occupy their time and populate their wallets. The dog days of summer came early, and look to stretch on for some time.
This has left your average banker at your average trading desk looking for some kind of action—any kind of action. Can the British vote to leave the EU again? No? Can someone else? Can we re-elect Donald Trump three-and-a-half years early? No? How about getting him elected German chancellor and general secretary of the Chinese Communist Party in addition to his presidential duties? How bad would a North Korean nuclear strike on the U.S. really be compared to its ability to inject a little volatility into this joint?
Which the exception of the latter, these are pipe dreams. But more to the point, unnecessary: You don’t need Kim Jong-Un to level Anchorage and San Francisco to get the markets moving. You just need to go on a little ski vacation.
In the past two weeks, the euro has leapt more than 4% against the Swiss franc—a decisive break out of the range that has held for two years….
The move will certainly be welcome to the SNB, as it may buoy Swiss inflation and growth. But it also reflects the shift in sentiment both around the eurozone and the global outlook—which makes it more significant than just being a foreign-exchange trade. Growth in the eurozone has stepped up a gear, reaching an annualized pace of 2.3% in the second quarter, and political risks have faded. Meanwhile global growth has been more synchronized. The need to cling to a haven like the Swiss franc has faded.