SNB was right to scrap Swiss franc cap: UBS's Weber

[DAVOS] The Swiss National Bank (SNB) was right to abandon its cap on the Swiss franc last week and had no option but to surprise markets when it did so, Axel Weber, the chairman of UBS said on Wednesday.

Speaking on a panel at the World Economic Forum in Davos, Weber, the former head of the German Bundesbank, said the 1.20 francs per euro cap, introduced at the height of the euro zone financial crisis in 2011, was always regarded as a temporary measure and that the Swiss economy could withstand its removal.

Weber also chastised European politicians for failing to take advantage of the time offered them by the European Central Bank (ECB) to reform their economies, and cautioned the ECB against going too far with a bond-buying programme it could announce as soon as Thursday. "They should not do too much," Weber said, saying this would remove incentives for reform in Europe.

REUTERS