Among a series of tensions over exchange rates The United
States and other countries have been calling on China to revalue, while China
has criticized the US easy monetary policy for weakening the dollar and
flooding the world with cheap assets.
"We are not in a currency war. After all, we're
talking to each other and you don't do that in a war," SNB Chairman
Philipp Hildebrand said in an interview published on Saturday on the website of
the German daily Frankfurter Allgemeine Zeitung www.faz.net.
Hildebrand agreed that adjustments in exchange rates
could be one of the measures needed to get out of the current difficult
situation for the global economy. But a significant appreciation of the Chinese
yuan could not occur overnight, he said.
In any case a sudden such move would hurt the Chinese
economy's growth prospects which would not be in the interests of other
countries, including the United States.
Commenting on criticism by some countries of the easy
monetary policy of the Fed, which is widely expected next week to embark on another
round of quantitative easing - printing money to buy bonds and drive down
interest rates - Hildebrand said he was confident the Fed would take into
account the global impact of its actions.
But he noted that unlike the European Central Bank or
SNB, the Fed has a mandate to promote employment as well as price stability.
Turning to the SNB's own interventions to hold down the
franc, which stopped in June, Hildebrand said the Swiss central bank did not
have a currency target, but had sold francs in pursuit of its goal of price
stability, specifically to avoid deflation which could create an economic
crisis.
The impact of the stronger franc on Swiss business has so
far been muted. Hildebrand said Swiss companies were flexible and it would
anyway take some time for the appreciation to have an effect.
"Meanwhile we can see that exports are no longer
having a positive stimulus on growth," he said, repeating the SNB's view
that growth will now slow, especially in the first half of next year.
Stability in Europe, Switzerland's biggest market, was
also a major factor on the franc exchange rate, he noted.
