If a Citibank dealer expects the Swiss franc to depreciate in the future, then he will lower bid and offer rates for the franc in order to discourage other dealers from selling francs to Citibank and persuade other dealers to buy francs from Citibank.

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If a Citibank dealer expects the Swiss franc to depreciate in the future, then he will lower bid and offer rates for the franc in order to discourage other dealers from selling francs to Citibank and persuade other dealers to buy francs from Citibank. This is because the dealer anticipates that the franc will be worth less in the future, so buying francs at a lower rate now means that the bank can sell them later for a higher profit. By lowering the bid and offer rates, Citibank can make itself a more attractive counterparty for dealers looking to buy francs.

If a Citibank Dealer Expects the Swiss Franc to Depreciate