3 Ways the Brexit VoteAffects the Swiss

The political structure of Europe is vastlychanging before the very eyes of manylong time citizens and patrons. For themost part, the British vote to leave theEuropean Union (Brexit) has not beengood news for most of the Europeancountries.

With many downturned economictrends forecasted for the next fewmonths, the minds of many are filledwith doubt. In regards to Switzerland,there are many impacts that the Swisswill feel, that hit uncomfortably close tohome. Here are 3 ways the Brexit voteaffects the economy of Swiss.

0 1 S T R O N G E RF R A N C

As a result of the Brexit vote the Swissfranc has rose sharply overnight, whichhas caused the government to step inand curb the spike. This is bad news forSwiss exporters, who are now forced tosquash costs while cutting their prices asthis is the only way for them to remaincompetitive at this point in time.

The franc has been known to be a fairlystable investment and has gained thatreputation over the past years and hasbeen known as a flagship for manyinvestors. However, that reputation is atstake now with the increased volatilityapproaching. It is predicted that inorder to get the franc back to normalwill have a devastating impact oninterest rates.

0 2 S W I S S S T O C K S

Stock Markets as a whole are down all overthe world, but more specifically the SwissMarket Index (SMI) has toppled by more than5% which crushed the large Swiss Banks. UBSshares were down 9% as of Friday morningand Credit Suisse, a staple in the bankingindustry, saw more than 10% of it’s valuewiped away. Although these were major hitsto start a Friday morning, the market hasbegun to climb back, but the damage hasalready been done.

0 3 N E G O T I A T I O N S

The Swiss have been in negotiations with theEuropean Union to decide on legislation inregards to curbing the immigration toSwitzerland. This legislation is to help combatthe fact that the Swiss simply cannot keep upwith the constant inflow of immigrants to theircountry. The negotiations have been throwninto turmoil once before in 2014, resulting inan angry Belgian government.

However, with Brexit turmoil on the rise thesenegotiations are sure to be throw into disarrayagain, alluding to the fact that they may notreach the concrete February deadline. Thisdeadline is crucial to the swiss economybecause immigrants are here to work, but thecountry is approaching a deficit in housing andemployment.

Final Thought

With most of the world in turmoil, the Swissare no exception to that statement. However,with a fairly distant connection to theEuropean Union, the Swiss should reachequilibrium once again, but it is going to takesome time.