The increased nervousness among market participants over the past week is palpable. The prospect of an expanding trade war is back on the table, the US yield curve is perilously close to a much-feared inversion, invoking calls for Fed easing later this year, and the European Commission just released its pessimistic excessive deficit review of …read more
•The economic rationale for entering, and ultimately exiting a regime of exchange rate interventions is markedly different for the Czech National Bank relative to the Swiss National Bank.
•The central bank balance sheet, politics and nature of the underlying economy (and currency) are, amongst other things, important factors in helping determine the likelihood of a central bank continuing to intervene in the FX market.
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