The Swiss Nation Bank finally caved to the pressures in the market and intervened unexpectedly by lowering the three month LIBOR rate bank to as low as possible near zero to counter the rapid franc appreciation and said it would take more measures if necessary.

The SNB cut the target range for the three month Libor Interbank rate to 0.00-0.25% from 0.00-0.75%. The bank also said it will increase the supply of francs to the money market over the coming days.

The statement said that that bank considers the franc to be massively overvalued at present and is threatening the development of the economy and increasing downside risk to price stability.

The bank also said they will expand the bank's sight deposits at the SNB from the current 30 billion franc to 80 billion. The bank said it will repurchase outstanding SNB bills until the desired level of sight deposits has been reached.

The franc weakened strongly after the surprise move from the SNB that said the outlook for the global economy worsened since the last quarterly meeting and the bank will act again if needed to stem the strength of the franc.

The EUR/CHF rebounded from a record low early this morning at 1.0793 to touch the high of 1.1103, while the USD/CHF reversed higher also from record low grounds at 0.7607 to the high of 0.7787 and currently around 0.7751 as of 08:25 GMT.