Gold Rises as Swiss Bank Introduces Negative Rates
The Swiss National Bank said it would charge banks 0.25% to deposit overnight funds with it, starting Jan. 22. The measure aims to cool the strength of the Swiss franc and keep deflation at bay.
Gold prices surged about $15 in response to the announcement. Negative interest rates are designed to slowly erode wealth and would likely prompt Swiss investors to shift from holding cash to holding gold, said Bob Haberkorn, a senior commodities broker with RJO Futures in Chicago.
“The fact that that’s the environment in Europe, and now Switzerland, is going to spur safe-haven demand,” Mr. Haberkorn said.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.