20110726 swissfrancs
A man shuffles through a stack of Swiss franc notes. - 

Steve Chiotakis: Economic woes of late have global money flowing to two stable and secure places -- gold and Switzerland. But the Swiss are tired of it. The Swiss franc is now
so strong that people in other countries cannot afford Swiss goods, which is threatening Swiss jobs. So the government there is battling to devalue its currency.

The BBC's Economics correspondent Andrew Walker is with us now -- or shall we call him our currency war correspondent? Hi Andrew.

Andrew Walker: Hello there.

Chiotakis: So, the latest skirmish is in Switzerland? Why is the Swiss franc facing so much heat?

Walker: Because it's seen by international investors as being a kind of safe haven -- somewhere stable to put your money when there are worries about other major areas. And of course, the Euro area is one example where concern about the government debt crisis is spooking investors quite badly. And then for people looking at the U.S. dollar there is of course the fact that the Federal Reserve has committed itself to keeping interest rates low for a long time. That suggests that the returns on investing in the U.S. economy might not be so good. So, they look for somewhere else, and the Swiss franc is one that's taking the heat. And when people are buying so many Swiss francs, that means its value has been going up relentlessly.

Chiotakis: But Andrew, Switzerland isn't the only country trying to devalue it's currency, right? So if we are in middle of a full-scale currency war, what does that mean?

Walker: I wouldn't say we're in the middle of a full scale war just yet, but there are some certainly, fairly heated skirmishes going on. And the other big example of that has been Japan, which intervened in the currency markets very heavily. It basically means there are some countries who are seeing their values of their currencies rising, making their industries less competitive. And they want to limit the extent of that. The reason it's happening is because of events in the United States and Europe. Some people say that in the case of the U.S., it's a deliberate attempt to push the value of the dollar down to make America more competitive. But whatever the underlying reason, there's no question its making life uncomfortable for many other countries.

Chiotakis: The BBC's Andrew Walker. Andrew, thanks.

Walker: My pleasure.