• Switzerland's news in English
Greece crisis
Swiss franc strengthens on Greek 'no' vote
Yes (Oxi) supporters celebrate outcome of vote. Photo: Louisa Goulimaki/AFP

Swiss franc strengthens on Greek 'no' vote

The Local · 6 Jul 2015, 08:45

Published: 06 Jul 2015 08:45 GMT+02:00

Facebook Twitter Google+ reddit

Currency traders sold off the euro over fears about the uncertain future for Greece in the eurozone following the results of the vote, which showed more than 61 percent of the electorate voting no while 39 percent supported the yes side.

The euro fell one percent to $1.099 from $1.111 against the dollar, while it slid to as little as 1.036 francs from 1.045 francs as soon as polls pointed to a “no” victory.

The euro rebounded on Monday, however, after Greek finance minister Yanis Varoufakis announced he was quitting, stating that fresh negotiations between the Greek government and creditors would go better without his presence at the table.

"Soon after the announcement of the referendum results, I was made aware of a certain preference by some Eurogroup participants, and assorted ‘partners’, for my… ‘absence’ from its meetings," he wrote on his blog.

Varoufakis, who had earlier accused creditors of being "terrorists", said stepping down was "an idea that the Prime Minister judged to be potentially helpful to him in reaching an agreement. For this reason I am leaving the Ministry of Finance today".

Greek Prime MinisterAlexis Tsipras, leader of the left-wing Syriza party elected in January to oppose austerity measures that have shrunk the Greece economy, said the referendum result did not mean that voters have given the government a mandate against Europe.

They have instead given it a mandate for a “sustainable solution,” he said.

Greek television reported that Tsipiras had started on Sunday night calling European leaders, including French President Hollande who was to meet with German Chancellor Angela Merkel about the Greek crisis.

But it was unclear what kind of cooperation Greece could expect from other European countries.

The head of Germany’s savings bank association told Reuters that Greece should leave the eurozone.

And the head of the German exporters association said he didn’t see how Greece could remain in the single-currency bloc.

Sigmar Gabriel, Germany’s economy minister, told the Tagesspiegel newspaper that the referendum result makes it difficult to imagine talks on a new bailout programme with Greece.

Some financial analysts said the yes vote would force Greece out of the eurozone, something that 75 percent of Greek voters oppose, according to one poll.

The uncertainty has driven up the value of the Swiss franc, seen as a safe haven in times of crisis.

Johann Schneider-Ammann, Swiss minister of economic affairs, said he expected the franc would be impacted by the result of the Greek referendum.

"The pressure on the franc is maybe going to accentuate," Schneider-Ammann, currently on a five-day trip to the US, told Le Temps newspaper.

"The critical situation that the eurozone finds itself in shows us the importance of diversifying our export markets." 

Schneider-Ammann added that the Swiss National Bank (SNB) was independent and it was up to it "to act if it sees fit". 

The central bank has already been intervening in foreign exchange markets to prevent the currency from rising further.

Traders last Monday drove the euro down to 1.0314 francs before the SNB intervened by buying euros.

The euro briefly head above 1.05 francs before falling back.

SNB Chairman Thomas Jordan said the central bank was prepared for a Greek euro exit but he did not give details about the strategy.

The bank in January stopped defending a 1.20 franc-euro rate after supporting this for more than three years, saying it was unsustainable, while at the same time claiming the franc was significantly overvalued.

A strong franc hurts Swiss exporters because it makes their products and services more expensive to customers in the eurozone, Switzerland’s largest trading partner.

Story continues below…

Swiss media commentators were skeptical about the chances of Tsipras reaching a deal with his European partners and creditors.

Commentator Peter A. Fischer, in an online column for the Nueue Zürcher Zeitung, said a “Grexit” is now a likely outcome from Sunday’s vote.

“A Greek exit from the monetary union cannot be enforced but it is the logical consequence of the people saying no,” Fischer said.

“The rude awakening will not be long in coming,” Stephan Israel, Tages Anzeiger’s EU correspondent said.

He said the prospects were bleak in Greece, where banks have been closed for a week and capital controls introduced following the collapse of talks with creditors and the announcement of the referendum.

Tsipras’s hopes of rapidly reaching a new agreement with loans from creditors after the no vote will come to nothing, Israel said.

“Not the least because the do not countries have an increasingly critical public, which it must take into consideration,” he said.

“Tsipras and his associates have destroyed any basis for trust.” 

For more news from Switzerland, join us on Facebook and Twitter.

The Local (news@thelocal.ch)

Facebook Twitter Google+ reddit

Your comments about this article

Today's headlines
Swiss woman wins headscarf court battle
Photo: Jack Guez / AFP file picture

A Swiss court has ruled against a company that fired a longtime employee after she began wearing the Muslim headscarf, marking one of the first such rulings in Switzerland, media reported Sunday.

Montreux throws hat in Olympic rings
Could Montreux host the 2026 Games? Photo: Ivo Scholz/Swiss Tourism

Montreux is to put itself forward as the host city for the 2026 winter Olympics as part of a potential bid by the cantons of Valais and Vaud.

Geneva car share scheme could help reduce city traffic
Catch a Car is aimed at short hops within a city. Photo: Catch a Car

Catch a Car, already in Basel, launches in Geneva next month.

Swiss women will ‘work for free’ for the rest of year
Female employees in Switzerland earn 19.3 percent less than their male colleagues. File photo: Randy Kashka

Switzerland's gender pay gap means from today, Friday October 21st, women in the country will effectively be working for free for the rest of 2016.

Swiss luxury watches stolen in Paris raid
Police outside the Girard-Perregaux watch store on Thursday. Photo: Bertrand Guay/AFP

The 10 Girard-Perregaux watches are worth half a million euros in total.

Brother-in-law arrested over murder of Swiss teacher
The victim worked in a school in Stabio, near the town of Mendrisio. Photo: Oliver Graf

The primary school teacher was found dead in Ticino earlier this week.

Inside Switzerland’s largest nuclear bunker – 40 years on
Designed to house 20,000 people, the bunker was built in and over two motorway tunnels. Photo: Unterirdisch Ueberleben

The Local takes a tour of the Sonnenberg bunker in Lucerne, opened 40 years ago at the height of the Cold War.

Ten Swiss ski resorts named most expensive in Europe
File photo: Renato Bagattini/Swiss Tourism

Skiers in Switzerland pay the highest prices for their ski passes of anywhere in Europe, according to research.

Eco group fights Bern over wind farm plans
There are currently more than 30 wind farms in Switzerland. Photo: Alpiq

Wind turbines are “gigantic and destructive” machines, says Paysage Libre Suisse.

Vegan wins battle to be accepted by Swiss army
Antoni Da Campo will now carry out his military service. Photo: Antoni Da Campo

A Swiss man who was told he would not be accepted for military service because of his strict veganism has finally succeeded in making the army change its mind.

Sponsored Article
How to vote absentee from abroad in the US elections
Photo: Richard Juilliard/AFP
Man makes Geneva airport bomb threat ‘for a joke’
Sponsored Article
Last chance to vote absentee in the US elections
Photo: AFP
Solar Impulse team reveals plans for unmanned plane
File photo: Martin Abegglen
Swiss to vote on passport rules for 3rd gen foreigners
Sponsored Article
How to vote absentee from abroad in the US elections
Photo: AFP
Swiss wingsuit hotspot Lauterbrunnen won’t impose ban
Photo: Swiss Tourism
Six reasons Switzerland isn’t as boring as you might think
Photo: Swiss Tourism
Report: Switzerland one of world’s best places for girls
Photo: The Local
Thief returns Swiss cow bells worth thousands
File photo: Wikimedia Commons
One in three rapists isn’t locked up: statistics
Photo: activistin.ch
Tampon-tax protest turns Zurich fountains red
Photo: AFP
Geneva police to lift ban on bearded officers
Photo: Marcel Gillieron/AFP
Suicide chef’s restaurant keeps Michelin stars
Photo: Lara de Salis
11 things the Swiss get tired of hearing abroad
Photo:  Ivo Scholz/Swiss-image.ch
Survey: expats in Switzerland have money but few friends
Photo: AFP
Swiss press criticize Bern’s 'capitulation' on immigration
Photo: Jura Trois Lacs tourism
German ex-policeman is Swiss city’s new hermit
Photo: Dmitry A. Mottl
Ticino votes to favour local workers over foreigners
Photo: file
Some deodorants could cause breast cancer: Swiss study
Photo: Royal Savoy
In pictures: Inside the latest Swiss luxury hotel
Photo: AFP
Geneva airport bomb hoaxer faces 90,000-franc bill
Photo: Schaffhausen police
Mother leaves toddler son alone in car to go clubbing
Photo: Fabrice Coffrini/AFP
Swiss populist attacked by knife-wielding pensioner
Photo: File
Bern argues over passports for 3rd generation foreigners
Photo: Broad Bean Media
Muslim pupils must shake hands – ‘no ifs and buts’
jobs available