The US Federal Reserve revealed on Thursday that it had provided $200 million of liquidity to the Swiss National Bank in the week ended Aug. 17 — the first time that the SNB had tapped its swap line with the Fed since it was reopened in May 2010.

In jittery global markets, the news fueled speculation that the SNB might be reacting to difficulties faced by a Swiss commercial bank in obtaining dollar funding.

But traders and analysts said there were no signs that Swiss banks were struggling to obtain dollar funds and that instead, they believed the SNB was expanding its dollar supplies as part of a drive to weaken the Swiss franc, which hit a record high against the euro on Aug. 9. 

The country’s two big banks, UBS and Credit Suisse, both said they had not made any use of the swap facility, while Julius Baer, Switzerland’s largest dedicated wealth manager, also said it had not used it.

“There’s no stress. Could have been a non-Swiss bank, and maybe it was just the national bank testing the waters,” one boutique money market trader said.

The SNB’s swap with the Fed occurred after it allotted $200 million to an institution in a weekly repurchase offer on Aug. 10, traders noted. At its next offer, conducted on Wednesday this week, there was no demand for dollars.

“The fact it didn’t happen again more recently suggests there aren’t any funding pressures and probably doesn’t point to any deterioration in the funding situation,” Credit Suisse economist Fabian Heller said.

The SNB has slashed Swiss franc interest rates to zero and is flooding the market with francs by rapidly expanding banks’ sight deposits as part of an effort to make holding francs more expensive. Sight deposits are accounts of commercial banks with the central bank, and constitute a large part of the liquidity in the banking system.

The SNB’s tools for expanding sight deposits are foreign exchange swaps and repurchases of its own debt. Earlier this week, the SNB expanded sight deposits to 200 billion Swiss francs from 120 billion francs.

“The total size of $200 million is indicative that this is not a major event, especially at a time when the SNB is expanding its sight deposits by 80 billion Swiss francs from one week to another,” UBS analyst Reto Huenerwadel said.

“The amount we are talking about is comparably insignificant.”

Since hitting its all-time high, the franc has weakened about 10 percent against the euro. Strong verbal warnings by the SNB and growing political support in Switzerland for action against excessive currency strength have contributed to the franc’s retreat.

Some market participants have speculated that the SNB could take more radical action to curb the franc, perhaps as soon as this weekend. But given its success so far, it is unlikely to take fresh steps so soon, several analysts said.

“Everything is possible with the SNB at the moment. We are in uncharted territory. But the latest activities don’t indicate near-term activities over the weekend. There are still a good amount of options out there,” UBS’ Huenerwadel said.

There has been speculation that the SNB, which came under heavy criticism for running up huge losses through currency interventions in 2009-2010, might resume intervening in the spot forex market. But so far it has not done so, suggesting it might try other steps first.

“I doubt that they will intervene. They had their chance earlier this week. The rumours are just normal market factors and the SNB is unlikely to want to put a lid on those,” Informa Global Markets analyst Mark Mitchell said.

But Mitchell said that if the SNB did not take any action, investors could become bolder about pushing up the franc, especially if the European Central Bank eventually cut interest rates because of a slowing regional economy.

“At the moment it is everyone for themselves. The push toward negative interest rates will bring nothing if the ECB decides to cut the two hikes it made earlier this year. What will the SNB do then? Make rates even more negative?” 

Swiss franc liquidity is so loose that rates on short-dated fixed income products, such as euro-Swiss futures, have turned negative. Another option might be for the government to impose a tax on offshore Swiss franc deposits, effectively giving holders a negative interest rate on them. 

However, “negative interest rates are so tricky and implementing those could trigger other reactions from banks as they would have a negative impact on their margins,” Heller said.

“The SNB is always good for a surprise so I wouldn’t exclude anything, but given that the euro/Swiss franc has stayed above 1.10 despite the fact the markets were down over the last couple of days points to some success for the SNB.”

There has also been speculation that the SNB may try to peg the Swiss franc to the euro or set a ceiling for it, but many economists are skeptical, noting that defending specific levels might invite the market to test them and require continual, massive intervention by the central bank.

“An exchange rate ceiling is one of the last big, big instruments left and they have to be careful when to use it,” Unicredit analyst Alexander Koch said.

“If they target a floor of 1.10/.15 francs per euro, this would be easier to achieve, but not much help to the rest of the Swiss economy. On the other hand it would be much more difficult to sustain a depreciation at around 1.25 francs per euro.”