Switzerland this week recorded a 7th straight month of annual price deflation in August - a funk it's been stuck in for almost half the 120 months of the past decade. Even with the most negative interest rates in the world, the Swiss National Bank has been forced to intervene again during this year's pandemic shock and sell the 'safe haven' franc against the euro and dollar to fight a deflationary spiral of falling prices and an appreciating currency. With SNB weekly sight deposits still rising, its foreign currency reserves - where 20% is banked in overseas equities - have topped $900 billion. And its top 5 equity holdings are the other winners from this year's pandemic - the albeit recently unnerved Big Tech vanguard of Apple, Microsoft, Amazon, Alphabet and Facebook. How does this strange dance end? Would a vaccine end the pandemic and remove the outsize demand for both franc 'safety' and tech?
Chart by Ritvik Carvalho and commentary by Mike Dolan.
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