(Reuters) By Dmitry Zhdannikov – A dramatic rise in the value of the Swiss franc sent costs soaring for the country’s commodity trading houses on Thursday, adding to pressures from tax and regulatory uncertainty that has already pushed many abroad. The Swiss National Bank shocked financial markets on Thursday by scrapping a three-year-old cap on the franc, sending the safe-haven currency soaring against the euro and stocks plunging. The country’s commodities sector comprises about 500 companies that contribute 20 billion Swiss francs (.2 billion), or 3.5 percent, of the country’s gross domestic product. Trading houses employ between 10,000 and 12,000, according to the Swiss Trading and Shipping Association. “Your cost base has increased overnight. It was a big surprise,” said Marco Dunand, the head of trading house Mercuria. Others were less diplomatic. “It is an absolute nightmare and a source of potential financial stress. What’s worse is that you cannot have any contingency planning for this,” a source at a rival trading house said, asking no to be named. Another trading source said: “Switzerland has always been one of the world’s most stable countries. But in the past few years you had tax uncertainty, regulatory uncertainty and now this monetary … continue reading
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