The Swiss National Bank has been enforcing a currency floor since 2011, not allowing the EUR/CHF rate to drop below 1.20 by buying unlimited amounts of foreign currency as needed with newly created CHF.
I'm having trouble finding exact amounts, but it seems from their balance sheet that their foreign currency reserves have increased by about CHF200bn since 2011.
How will they unwind this situation? They state that they still view CHF as overvalued at the 1.20 rate, so presumably they would let it drop some way from that before they start selling the reserves, leaving them with a gain in CHF. Will they just leave the money base permanently contracted to account for this? What long-term impacts will this have?