Swiss parliamentarians urged rejection of a popular initiative that would curtail the Swiss National Bank (SNBN)’s independence by requiring it to hold a fixed portion of its assets in gold.
No date for a national vote has yet been set. The government in November also recommended the initiative be opposed, saying it would impinge upon the SNB’s ability to conduct monetary policy. Parliament and the multi-party government issue recommendations on all national referendums as a matter of procedure.
The balance sheet of the SNB, which owned 1,040 tons of gold as of end March, has expanded due to the currency market interventions it has used to defend the cap of 1.20 per euro on the franc, set in September 2011. The SNB held foreign-exchange reserves of 438.4 billion francs ($500 billion) in April, a sum equal to about three quarters of the country’s annual economic output.
Members of the Swiss People’s Party SVP started the initiative and collected the requisite 100,000 signatures last year after failing to get backing for the matter in parliament.
“We need gold to give the Swiss franc a credible backbone,” said Luzi Stamm, a member of the SVP who founded the campaign “save our Swiss gold.”
As of April 2013, more than 70 percent of the SNB’s gold was in Switzerland, with about 20 percent at the Bank of England and 10 percent at the Bank of Canada.