Swiss voters on Sunday overwhelmingly rejected an initiative that would have forced the country’s central bank to hold a fifth of its assets in gold, which would have eroded its ability to conduct monetary policy. Citing projections from results in 19 of the country’s 26 cantons, Swiss television said roughly 78% of voters opposed the initiative, dubbed “Save Our Swiss Gold.” The gold initiative would have also barred the Swiss National Bank from selling gold in the future if it passed. The initiative was widely criticized by Switzerland’s political and business communities because of its potential to disrupt the central bank’s monetary policy. For the last three years, the bank has capped the Swiss franc at 1.2 per euro by purchasing huge amounts of the common currency, a policy designed to protect the Alpine country’s exports. Critics of the initiative feared the SNB’s commitment to the cap would have been challenged because the central bank would have been forced to buy gold every time it intervened in the currency market. Both the foreign exchange and gold markets had been closely following the initiative, with gold falling sharply when a poll showed voter support for the measure waning. The SNB declined to comment on the results. But the Zurich-based bank had previously broken its long-standing policy against commenting on political issues with its highest executives giving a series of speeches in the run-up to the vote warning that the initiative could have disastrous results for the country’s economy. The SNB currently holds 1,040 metric tons of gold, making up about 7.5% of its assets. It would have needed to buy a further 1,500 tons for roughly 60 billion francs to meet the 20% level, according to analyst estimates. WSJ.com