The general consensus is that SNB president Thomas Jordan should have communicated with the market or given some sort of warning before implementing extreme measures to release the cap of 1.20 against the euro, which was established in September 2011.
The SNB’s statement did not only affect the Swiss Franc (CHF) which soared 14% against the euro (a historic move); crude oil also moved up, briefly trading over USD 50 from a close at USD 48 the day before. Silver rose above USD 17 and Gold broke an important resistance level of USD 1,250.
ICM Capital managed their exposure to the Swiss Franc and the movement in the currency has had no material impact on the company’s financial and trading position. ICM Capital remains financially strong and continues to meet its capital regulatory requirements.
Director at ICM Capital, Shoaib Abedi, reported on his firm’s reaction: “I am pleased to confirm we are continuing business as usual and we have not been affected by the recent announcement made by the Swiss National Bank. Our clients’ interests are always our top priority and we continue to support them in their trades as usual. We pride ourselves on offering a secure trading environment along with unique offers and advantages. ”
The central bank announcing news like this without forewarning traders or brokers, with trillions of U.S. dollars being traded on the financial markets daily, has definitely left its mark. This was the biggest news the markets have felt for some time. The coming weeks if not months will be a testing time for many as they analyse their risk management procedures.