Safe haven's 'trying to undermine their currency value'

The recent announcement by the Swiss National Bank (SNB) that a ceiling was to be imposed on the franc's exchange rate is an indication that forex traders may see more safe havens taking steps to reduce the value of their currencies.

This is according to portfolio manager at Ignis Asset Management in Glasgow Stuart Thomson, who told Bloomberg that there is likely to be "a lot more intervention now".

People involved in FX trading may see other central banks attempt to weaken their exchange rates, something Japan has already done.

Last month, the country spent 4.51 trillion yen (£36 billion) on yen sales in what was the greatest intervention seen in seven years.

"We will see manipulation on a grand scale ... traditional safe havens are trying to undermine the value of their currencies," said Mr Thomson.

Yesterday's announcement by the SNB resulted in the franc falling 8.4 per cent against the euro.

Posted by Greg Secker