Swiss franc deposits by foreign lenders at Swiss banks declined 14 percent in April, according to central bank data.
Deposits dropped to 109.3 billion francs ($117.7 billion) from 126.7 billion francs in March, the Swiss National Bank said in its monthly bulletin of banking statistics published today.
The Swiss currency is seen as a haven at times of heightened global stress, according to a study published by the SNB in April. That pushed the franc near parity with the euro in 2011 and caused the central bank to set a ceiling of 1.20 francs per euro in September of that year to ward off deflation and a recession.
“Since the SNB set the cap on the currency, foreign banks’ francs deposits in Switzerland have almost doubled, reflecting strong demand for safe havens,” said Maxime Botteron, an economist at Credit Suisse Group AG in Zurich. “The decline in deposits in the April data shows a normalization in capital flows, albeit a gradual one. This trend of outflows is expected to continue, which should weaken the franc.”
The Swiss currency, which has declined 1.6 percent this year against the euro, traded at 1.2269 per euro at 10:34 a.m. in Zurich. Against the dollar it was at 92.78 centimes.
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