Switzerland isn’t afraid to be considered currency manipulator by US Treasury

The Swiss government on Tuesday acknowledged the country's reappearance on a U.S. Treasury watch list of currency manipulators, but said the status would have no immediate consequences, as Reuters reported.

Switzerland met two of the three criteria to be named a manipulator, both in the most recent report and the previous one in October: it runs a material current account surplus and it engages in persistent, one-sided intervention in foreign exchange markets.

It did not meet the third criterion of running a bilateral trade surplus with the U.S. of at least $20 billion. "The Swiss National Bank, according to its legal mandate, follows its own independent monetary policy," the Swiss fiance department said in a statement.

"Their currency purchases are not aimed at devaluing the currency and raising the competitiveness of Swiss exports," it added. "Its goal is to limit the extent of the franc's overvaluation and prevent a strong downward push in inflation."

Also Jorg Gasser, the country's state secretary for international financial matters, underlined in an interview with CNBC on Tuesday; he noted that Switzerland had discussed the matter with the previous U.S. administration for "quite some years."

But he added, "There are some good explanations for that. Switzerland is not manipulating its own currency. It's simply that the Swiss franc is grossly overvalued." He noted that the Swiss franc has risen around 40 percent since the global financial crisis.

"It is understandable that we have to do something about it," Gasser said. "They have to keep the Swiss franc on a level that is possible for the Swiss economy to work." Gasser noted that the franc still faced upward pressure, particularly amid uncertainty over Brexit and other geopolitical developments.

"Switzerland, or the Swiss currency, has always been a safe haven, in difficult times," he said. "It's not so much about a strong Swiss franc. It's rather about a very weak euro. And as you know, monetary policy is made in Frankfurt and not in Zurich, so there is very little influence that we can have on the euro."

The Trump administration placed six trading partners on a "monitoring list" to keep a close watch on their currency practices: China, Germany, Japan, Korea, and Taiwan in addition to Switzerland.

On March the Economist magazine placed Switzerland first in a ranking of currency manipulators. According to the analysis, Switzerland that has been working hardest to artificially devalue its money.