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I am confused of how the Swiss National Bank's famous FX interventions are reflected in the change in Sight Deposits.

Against the backdrop of the ECB meeting, it is said that the SNB has taken pressure off the CHF by buying foreign currencies. And it is said that this precise FX intervention is reflected by a +800m CHF change in the Deposit Balance.

Now, I understand the Sight Deposit is simply the reserves banks in Switzerland hold at the SNB. How on earth will FX purchasing action from the SNB reflect on the reserves that some random bank holds at the SNB?

I know this is rather economical than quant, but any help is appreciated

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    $\begingroup$ In a nutshell the central bank purchases FX by creating domestic high powered money (bank reserves), which it gives to banks in return for the EUR it purchases from them. In due time the purchased FX will show up on the asset side of the central bank balance sheet where we can see it, but in the meantime we can get some idea of the amount by looking at the increase in bank reserves (assuming there are no other factors that affect bank reserves). $\endgroup$ – Alex C Sep 17 '19 at 19:36
  • $\begingroup$ @AlexC I don't understand what you mean by "In due time the purchased FX will show up on the asset side of the central bank balance sheet where we can see it, but in the meantime we can get some idea of the amount by looking at the increase in bank reserves". And when you say bank reserves, you mean money that any bank parks at the SNB right? $\endgroup$ – MinaThuma Sep 17 '19 at 20:07
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    $\begingroup$ In the nutshell of a nutshell, SNB prints Swissies to buy EUR. Their counterparty now has a CHF cash balance in their Swiss account. Whatever they then do with that cash, they will end up passing it on to someone else, who at the end of that day, will have that same Swissie in the Swiss clearing system. Whoever ends up holding that "hot potato" on any given day, it will remain as a "sight deposit" on the SNB's balance sheet. The FX purchase creates the (SNB) liability, (bank) asset; and the asset can no more magically disappear than the SNB's liability can. $\endgroup$ – demully Sep 17 '19 at 20:57
  • $\begingroup$ @MinaThuma I don't know how often the SNB publishes a complete balance sheet. But for ex. if it is monthly, we have to wait until the end of September for the next one. $\endgroup$ – Alex C Sep 18 '19 at 0:43

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