The level of Swiss sight deposits fell slightly, according to data published on Monday, indicating the Swiss National Bank has dialled back its currency market interventions that aimed to weaken the Swiss franc.
The total level of sight deposits -- cash held overnight by commercial banks with the SNB -- fell to 751.83 billion Swiss francs ($779.99 billion) last week from 753.08 billion francs.
Normally, an increase indicates that the SNB has been selling newly created francs to the commercial banks, whose accounts with the central bank increase as a result.
The operation has been a cornerstone of the SNB's campaign to weaken the safe-haven franc in recent years, due to concerns the currency's high value was damaging Switzerland's export-based economy and contributing to deflation.
The SNB declined to comment.
Last week the SNB changed tack, hiking its main interest rate for the first time in 15 years and saying it would tolerate the strength of the franc unless there was an "excessive appreciation" of the currency.
SNB Chairman Thomas Jordan said the franc was no longer highly valued, due to higher inflation in other countries.
The decline in sight deposits did not surprise Karsten Junius, an economist at J Safra Sarasin.
"The SNB has made it overly clear that they do not intend to intervene in the FX-market to prevent a stronger Swiss franc as long as developments are smooth," he said.
"Given their inflation forecast of above 2 per cent in Q1 2025 it is clear that a measured appreciation of the CHF would be welcome by the SNB as it would help keep imported goods prices down."
UBS economist Alessandro Bee said he would be surprised if the SNB had intervened recently, especially after Thursday's hawkish tone.
Still, as sight deposits generally reflect interventions from the first part of the week, this week's data doesn’t give great insight into happened after Thursday, he said.
"We may wait for next week to get a clearer picture," he said.