Franc Falls as Economy Minister Says Currency Is ’Massively Overvalued’ - Bloomberg

Franc Falls as Economy Minister Says Currency Is ’Massively Overvalued’ - Bloomberg: The Swiss franc fell against the euro and the dollar as Economy Minister Johann Schneider-Ammann said the currency remains “massively overvalued” even after the nation’s central bank imposed a ceiling.

The franc traded at almost the weakest level against the euro since July, after tumbling Sept. 6 when the Swiss National Bank established a franc ceiling at 1.20 per euro, the first time such a limit was set since 1978. The SNB said it would use “unlimited” quantities of cash to cap the increase. The currency had strengthened 13 percent against the euro this year before this week as investors sought haven assets amid Europe’s sovereign-debt crisis.

“The franc is now effectively a proxy for the euro, now that it’s pegged to it,” said Lee Hardman, a currency strategist at Bank of Tokyo-Mitsubihsi UFJ Ltd. in London. “The franc is certainly overvalued against the euro.”