Swiss franc

economic-dictionary

The Swiss franc is the official currency of Switzerland and Liechtenstein. Today it is the only currency that retains its denomination in francs on European territory.

Within the European territory, the existence of the Swiss franc as legal tender stands out especially given the expansion and prevalence of the use of the euro as a common currency among the different territories of the continent.

This coin has been considered in recent decades as one of the most stable and secure. Its stability and security are largely due to Switzerland's political and economic position. It also highlights its important interrelation role with European economic policies and its complex fiscal and monetary system.

In that sense, it is considered as a kind of refuge for foreign investment. They seek their stability when it comes to achieving profitability based on the good economic position of Switzerland and Liechtenstein and their remarkable gold reserves maintained.

The abbreviated term for the Swiss franc is CHF within the banking and currency markets. Alternatively, its currency symbol is Fr, which is its most colloquial use in everyday life or in the media.

Appearance and history of the Swiss franc

The Swiss franc appeared and was adapted as an official currency in Switzerland in 1850. Its origin responds to the replacement of the previous Swiss cantons. The cantons had a more territorial or regional nature for each zone.

Until then, a large number of currencies had coexisted, which significantly complicated the day-to-day economy due to the poor cohesion of the Swiss monetary system. From that moment, only the Federal Government would have the legal power to issue the Swiss franc as the only legal tender.

Main characteristics of the Swiss franc

This coin stands out mainly for a series of qualities such as:

  • It is rarely affected by inflationary changes. See inflation
  • It has bills of 10, 20, 50, 100, 200 or 1,000. As for coins, coins of 1, 2 and 5 francs and 5, 10, 20 or 50 cents are in legal tender.
  • In addition to being the official currency in Switzerland and Liechtenstein, they are used in other areas. For example, Swiss francs are also legally used in certain areas of Italy (Campione d'Italia) and Germany (Büsingen am Hochrhein).
  • Formally, the Swiss National Bank is the institution in charge of issuing banknotes. For its part, the federal Swissmint creates and puts the coins into circulation.

Tags:  economic-analysis famous-phrases administration 

Interesting Articles

add