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20/06/24
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Swiss National Bank Cuts Rates Again
On Thursday, the Swiss National Bank trimmed interest rates for the second straight time, indicating cooling price pressures that permitted it to keep its position as the front-runner in the global policy-cutting cycle.
The Swiss franc was lower versus other currencies and stocks gained after the central bank reduced its policy rate by 0.25% to 1.25%, as expected by analysts, after a 0.25% cut in March.
The SNB’s decision had been balanced finely, given the recent economic growth rebound and a break in the trend of gently dropping Swiss inflation.
Thomas Jordan, the SNB’s Chairman said that compared to the previous quarter, the underlying inflationary pressure had dropped again. He added the SNB was able to maintain appropriate monetary conditions with the lowering of the policy rate.
Jordan also indicated that this was not the end of the SNB’s easing. Jordan told Swiss broadcaster SRF that looking at inflation, it can be seen that it was falling slightly.
Jordan earlier mentioned the SNB’s inflation forecasts, which were changed downwards and enabled the cutting of interest rates.
Even at the furthest limit of the forecasts – covering Q1 of 2027 – the SNB now forecasts inflation will be at 1.0%, well within the target range of between 0% and 2%.
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