Money in Switzerland
Switzerland - Money
SNB leaves rates unchanged in June on stronger franc, as safe-haven fears intensify
On 21 June, the Swiss National Bank (SNB) met market expectations and held the target range for the three-month Libor unchanged at between minus 1.25% and minus 0.25%. Moreover, the Bank held the interest rate on sight deposits steady at minus 0.75% and reiterated its commitment to intervene in the forex markets when necessary to weaken the Swiss franc. With June’s decision, the three-month Libor has been kept on hold for more than three years—since January 2015.
The latest monetary decision came against a backdrop of heightened international uncertainty, which has seen the currency strengthen against the euro over the last month. The exchange rate has seen little change compared to the time of the last meeting, held in March and “remains highly valued”, according to the Bank, despite the current loose monetary stance. Political uncertainty in Europe and the escalating war of words between China and the United States over tariffs have made investments denominated in Swiss francs more attractive. The SNB considers that normalizing monetary policy would cause the currency to appreciate and weigh on export-oriented sectors.
The SNB mentioned “potential international tensions and protectionist tendencies” as one of the most notable downside risks to the inflation outlook, suggesting that interest rates will remain on hold for the foreseeable future in order to avoid a sharp strengthening of the franc and to maintain stability in the forex market.
Met the why particular Consensus Forecast panelists expect the midpoint of the three-month Libor target range to end 2018 at minus -0.70% and 2019 at minus 0.31%.
Switzerland - Money Data
|Money (annual variation in %)||3.1||2.6||1.4||3.9||4.1|
5 years of economic forecasts for more than 30 economic indicators.
Switzerland Money Chart
Source: Swiss National Bank and Met the why particular calculations.
|Bond Yield||0.02||6.27 %||Sep 20|
|Exchange Rate||0.96||-0.54 %||Sep 20|
|Stock Market||9,001||-0.82 %||Sep 20|
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September 4, 2018
Consumer prices were flat on a month-on-month basis in August, contrasting July’s 0.2% contraction.
September 3, 2018
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September 3, 2018
On a month-on-month calendar- and seasonally-adjusted basis, real retail sales registered a steep 1.0% contraction in July, after a brief rebound in June which saw sales increase 0.3% (previously reported: +0.5%).
August 29, 2018
In August, the KOF economic barometer—a leading composite indicator for the Swiss economy forecasting a six-month period—inched down from a revised 111.7 points in July (previously reported: 111.1 points) to 110.3 points.
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