Investing.com - The Swiss franc rose against the euro on Wednesday, extending strong gains from the previous session, one day after the chairman of the Swiss National Bank warned that the extent of what monetary policy can achieve is not unlimited.
EUR/CHF slid 0.25% to 1.0897, the lowest level since January 13 after ending Tuesday’s session down 0.88%.
Demand for the franc, which is usually bought by investors in times of market uncertainty, was boosted as fresh falls in oil prices dampened demand for riskier assets.
Oil prices remained under pressure amid concerns about global oversupply after Saudi Arabia ruled out production cuts.
The franc also remained supported after SNB head Thomas Jordan said Tuesday the bank could not take “endless” steps to ease monetary policy.
"Despite the expanded set of monetary policy instruments available, the options are not unlimited," he said.
Jordan also noted that central bankers must continuously assess the effects of their monetary policies which can weaken over time.
Interest rates cannot be lowered into negative territory without at some point prompting a flight to cash, he warned.
The remarks, made during a speech in Frankfurt, were seen as an indication that the SNB would refrain from making further cuts to interest rates.
Earlier this month Jordan had indicated that the SNB could cut its -0.75% deposit rate deeper into negative territory.
The SNB is to hold its next monetary policy meeting on March 17.
The franc was little changed against the dollar, with USD/CHF at 0.9919