Höhe und Bedeutung der Währungsreserven der Schweizerischen Nationalbank

Peter Klauser, Director of the Swiss National Bank

Delegate conference of the Swiss People's Party (SPP), 30.05.1998

The SNB's foreign currency reserves fulfil a number of functions. The unhedged foreign exchange reserves permit the SNB to intervene in the foreign exchange market in the event of exchange rate turbulences and to restore orderly exchange rate relations. The exchange rate-hedged foreign exchange reserves, which the SNB holds in the form of liquidity swaps, are used as an instrument for steering the money supply. With the reform of the monetary constitution gold will acquire a new significance: it can be valued closer to market prices and will no longer serve as cover for banknote circulation. Nevertheless, it continues to be a prime reserve medium. For, other than in the case of foreign exchange investments, the disposal of domestic gold stocks is not subject to any restrictions by foreign authorities. Gold holdings are an important means of providing for emergencies, and - for emotional reasons - they enhance the credibility of monetary policy. At the end of 1997, the SNB's foreign currency reserves amounted to approximately Sfr 68.5 billion, with gold (2,590 tonnes) still valued at the official parity price of Sfr 4,595/kg. Gold thus accounted for 17.4% of currency reserves, unhedged foreign exchange reserves for 59.7% and exchange rate-hedged foreign exchange reserves for 18.2%. The remainder (4.7%) represented balances at the IMF and international payment instruments such as SDRs and ECUs. A comparison between individual components of the SNB's foreign currency reserves and the foreign currency reserves of central banks of other industrialised countries similar in size with an international involvement shows the following: the SNB does not hold an unusually large volume of unhedged foreign exchange reserves. The exchange rate-hedged foreign exchange reserves, which de facto constitute Swiss franc investments, must in any case be excluded from an international cross-comparison due to their different function. In quantitative respects, however, the SNB's exceedingly abundant gold reserves are exceptional. Gold stocks of close to 1,3000 tonnes are sufficient for securing Switzerland's role as a major international financial centre and for adequately supporting the SNB's independent monetary policy in a European context. Half of the SNB's current gold holdings - 1,300 tonnes or approximately Sfr 18 billion valued at today's market price (Fr 14,000/kg) - are available for other public uses.