For many people, both inside and outside Switzerland, there has long been an assumption that the strength of the country’s currency and its economy owes much to its considerable reserves of gold.
With those reserves depleted, the Swiss Franc itself has come under scrutiny recently as concerns are growing that it is suffering the same kind of monetary debasement that the US Dollar has over the past few years, with the SNB engaged in a care-free monetary policy.
Quantitive Easing has been undertaken by the bank in an effort to stop CHF from appreciating to strongly against the Euro which has been rocked by crises that have unfolded one after another across the Eurozone member countries. Policymakers state that strength of the Swiss franc threatens economic development and increases price instability.
Calls for more transparency regarding the remainder of Switzerland’s gold reserves have been met with statements from the Swiss National Bank that its physical gold reserves are held “domestically and internationally, with provisions for a crisis scenario being a main factor in the decision for this decentralized storage”.
Whereas the SNB may have good reason store Swiss gold outside of its border, it does worry many Swiss people who fear possible confiscation by these foreign jurisdictions in the cataclysmic event of some kind of economic collapse.