An empirical analysis of international interest rates and of the behavior of the exchange rate of the Swiss franc since 1850 leads to the conclusion that World War I marks the origin of the strong currency and safe haven status of the Swiss franc. Before World War I, interest rates point to a...

This article studies Swiss monetary policy of the 19th and 20th century to understand the Swiss Franc's strength and stability. The continued appreciation against other currencies over the course of a century went hand-in-hand with Switzerland's political and social consolidation as well as its...