The Swiss Central bank announced today it has abandoned plans to cap the swiss Franc against the Euro at 1.20. Driving currency markets to extreme turmoil and causing huge losses at a number of forex brokers as the day unfolded.
At some points the Swiss Franc rose 30% against the Euro, a rise not seen since the first world war. Other brokers also sustained losses however most consider it “business as usual”.
In a statement on the Alpari website the company said “The recent move on the Swiss franc caused by the Swiss National Bank’s unexpected policy reversal of capping the Swiss franc against the euro has resulted in exceptional volatility and extreme lack of liquidity. This has resulted in the majority of clients sustaining losses which has exceeded their account equity. Where a client cannot cover this loss, it is passed on to us. This has forced Alpari (UK) Limited to confirm today, 16/01/15, that it has entered into insolvency. Retail client funds continue to be segregated in accordance with FCA rules.”