The Swiss currency has spiked more than 20% against the dollar since June, when Europe’s sovereign debt crisis sparked a flood of money into the franc amid worries about the unfolding crisis.
“The Swiss National Bank has been quite vocal about the rise,” said Dolan. “And yet the Swiss breitling watches franc has continued to strengthen. The global factors are simply too big for the central bank to overcome.”
The intervention was ineffective. And according to Lien, the franc has already risen to a level that is harming the country’s export business.
Strangely enough, some Swiss export items are still super-hot at the moment. Among the bright spots: watches.
On Thursday, the Swiss Watch Industry Federation reported annual sales growth of 45% for 2010, and expressed confidence in the strength of the market, citing rapid growth in Asia. In December, sales spiked 71% in China, and 59% in Hong Kong.
And generally speaking, the watch industry did well in countries that have emerged strongly from the global downturn. As long as those places remain hot, demand for Rolex watches might overpower a strengthening franc.
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