The 2015 Swiss Franc Shock: When the SNB Removed the Floor

In eleven minutes on the morning of 15 January 2015, the Swiss franc appreciated by about 30% against the euro — the most extreme intraday move ever recorded in a major currency pair. The Swiss National Bank had, without any public warning, abandoned the EUR/CHF minimum exchange rate of 1.20 that it had defended for three and a half years. Brokers collapsed, hedge funds were wiped out, and currency volatility gauges spiked to levels not seen since the financial crisis. It remains the most dramatic single central-bank decision in modern FX history.

What was the EUR/CHF floor?

The EUR/CHF minimum exchange rate of 1.20 was introduced by the SNB on 6 September 2011 at the height of the eurozone debt crisis. Safe-haven flows were flooding into the franc — investors terrified by Greek, Italian, and Spanish debt crises were piling into Swiss francs as a refuge, driving EUR/CHF toward parity and threatening to make Swiss exports uncompetitively expensive.

The SNB's statement was unambiguous: it would "no longer tolerate" a EUR/CHF rate below 1.20, and was "prepared to enforce this minimum rate with unlimited purchases of foreign currency." The word "unlimited" was key. The market believed it, the peg held, and EUR/CHF stayed above 1.20 for over three years.

Why did the SNB remove the floor?

The proximate cause was the European Central Bank's looming quantitative easing programme. Markets widely expected the ECB to announce large-scale bond purchases at its 22 January 2015 meeting. Every euro sold by QE investors found its way, through the path of least resistance, into Swiss francs — and that meant the SNB had to keep buying euros at an accelerating rate to keep EUR/CHF above 1.20.

The SNB's own analysis from chairman Thomas Jordan stated plainly: "due to the sustained weakening of the euro during the first half of January 2015, the minimum exchange rate could only be enforced through permanent currency interventions of rapidly increasing magnitude." The balance sheet constraint was real — the SNB's foreign reserves had already grown to exceed the size of the entire Swiss economy.

The SNB simultaneously lowered its sight deposit rate from –0.25% to –0.75% — the most negative central bank rate in the world at that time — in an attempt to reduce the attractiveness of holding francs and dampen some of the shock.

The scale of the move

To put the 30% move in context: the euro typically moves about 0.5% against the franc on an active trading day. A 30% intraday swing is the equivalent of 60 "normal" days of volatility occurring simultaneously. Several retail FX brokers were made insolvent by client losses that exceeded their deposited margin. In Switzerland itself, exporters saw their competitive position deteriorate overnight.

What the strength meter shows about the CHF

From a macro-fundamentals standpoint, the Swiss franc is one of the most structurally unusual currencies among the eight majors. It scores persistently high on safe-haven and current account metrics — Switzerland runs a chronic current account surplus and has a safe-haven reputation that is decades old. But it scores poorly on yield: negative interest rates during 2015–2022 meant the carry cost of holding francs was a persistent drag on any yield-seeking framework.

The EUR/CHF floor was, in currency-strength terms, an artificial suppressor of CHF strength. The SNB was printing francs and buying euros to hold down a currency that the market wanted to hold at a higher level. When the suppression was lifted, the "stored" appreciation was released instantly.

The Pip Theory Macro Currency Strength Meter's safe-haven component attempts to measure this structural bid. For the CHF, risk-off environments reliably push the score higher — and any policy that suppresses that score artificially is storing up pressure. The About & Methodology page explains how the five macro drivers are weighted for each currency.

Aftermath and lasting impact

The Swiss franc shock had cascading effects across financial markets:

• Swiss exporters including Swatch, Nestlé, and ABB warned of significant earnings hits as their products became immediately more expensive for foreign buyers.
• Several retail FX brokers — most prominently FXCM (US) and Alpari (UK) — suffered losses that exceeded client margin, requiring emergency capital or insolvency proceedings.
• The episode reignited debate about whether central bank verbal commitments to pegs are ever truly "unlimited." The BIS later noted the SNB's balance sheet had grown to extraordinary levels relative to Swiss GDP, making the intervention path genuinely unsustainable.

For a fuller picture of how currency pegs behave under stress, compare this episode with Black Wednesday 1992, where the Bank of England was forced out of its peg by speculators, or with the Plaza Accord, where governments voluntarily coordinated to move exchange rates. All three illustrate the same underlying principle: official exchange-rate policy can channel and defer currency moves, but rarely defeats them permanently.

The BIS Bulletin No. 90 — on a different but structurally similar shock (the 2024 yen carry unwind) — is also relevant reading for understanding how leveraged positioning amplifies central-bank policy surprises.

How to read CHF in a macro strength framework

The Swiss franc shock also offers a precise lesson in how to interpret a safe-haven currency inside a multi-factor framework like Pip Theory's Macro Currency Strength Meter. The CHF presents a genuinely unusual scoring profile among the eight major currencies:

• Safe-haven component: structurally among the highest of the eight majors. Switzerland runs a persistent current account surplus — typically above 10% of GDP — and its financial system and political neutrality give the franc a safe-haven premium that has been reinforced through every crisis from the eurozone debt scare to COVID-19.
• Yield component: persistently the weakest among the majors. The SNB held interest rates at –0.75% from 2015 through 2022 — the most deeply negative rates of any central bank. Even after normalisation, Swiss rates remain below peers.
• The tension: the franc is simultaneously a currency that should attract risk-off capital (high safe-haven score) and should repel yield-seeking capital (very low or negative rates). The interaction between these two forces makes the CHF particularly sensitive to regime changes in global risk appetite.

During the 2011–2015 floor period, the SNB was suppressing the safe-haven component by force. It was buying euros and printing francs — diluting the supply of a currency the market wanted more of. The macrofundamental pressure was building underneath the flat EUR/CHF chart the whole time. A currency strength framework tracking the underlying drivers would have shown CHF as persistently undervalued relative to its macro score — the divergence between the policy-held rate and the model's fair-value estimate growing larger with each passing month.

When the floor was removed, that gap closed instantly. The post-shock EUR/CHF level of around 1.04 — not 0.805, where it briefly traded — was approximately where the market thought fair value actually was, having priced out both the safety-valve premium the floor provided and some of the immediate panic overshoot.

Today, the CHF currency page on Pip Theory scores the franc across all five macro factors in real time. The safe-haven and current-account components remain structurally positive; the yield drag has partially diminished following the SNB's 2022–2024 rate normalisation cycle. Monitoring how those two forces interact gives traders the earliest possible read on when safe-haven demand is likely to drive EUR/CHF lower — rather than waiting for the next announcement that nobody warned them was coming.

Three lessons for macro currency traders

1. Verbal commitments are not permanent "Unlimited" means unlimited as long as the cost is bearable. When the SNB's balance sheet exceeded Swiss GDP, the cost was no longer bearable. Pegs backed by unlimited rhetoric still have implicit limits.
2. The snap is proportional to the stored pressure Three and a half years of suppressed CHF appreciation arrived in eleven minutes. The longer and harder a peg has been defended, the more violent the release.
3. Safe-haven currencies need wider stops CHF, like JPY, is subject to sudden sharp moves when risk dynamics change. Positions near known policy levels require position sizes that can survive a 10–30% adverse move, not a 0.5% adverse move.

Educational macro context only — not investment advice.