07 Sep 2011 11:52 PM
|Globally there have been 2 events that have overshadowed the markets so far this week.
As the USA was winding down into a bank holiday weekend on Friday evening, the Federal Housing Finance Agency (FHFA) announced that they were suing 17 Major US and European including banks over the mis-selling of mortgages leading up to the credit crisis relating to losses of approximately $200 Billion for Fannie and Freddie Mac ( The government owned US mortgage companies). This caused a session of profit taking in the US stock market and strengthened the USD across a basket of currencies
Yesterday the Swiss National Bank took the extraordinary steps of setting a minimum target rate of 1.20 for EUR/CHF. They have confirmed that they are prepared to trade unlimited quantities of foreign exchange if necessary. Initially this had a major affect on the Swiss franc across the board and has left traders re-evaluating their strategies, and more importantly which currencies they will move the Swiss franc into.