SNB Holds Rates at 0%

The Swiss National Bank kept its policy rate at 0% in its June 2026 meeting, as expected, stating the current stance supports price stability and economic growth. Policymakers noted that medium-term inflation pressures remain largely unchanged, despite recent price increases driven by higher energy costs. The SNB forecasts inflation to rise slightly in the near term before easing in early 2027, with annual averages of 0.6% for 2026 and 2027, and 0.7% for 2028. Growth is projected at 1% for 2026 and 1.5% for 2027. The bank highlighted global economic risks, particularly Middle East tensions, potentially strengthening the Swiss franc, and uncertain US trade policy. The SNB also signaled a greater readiness to intervene in foreign exchange markets if needed.

The Swiss National Bank kept its policy rate unchanged at 0% in March 2026, maintaining remuneration on sight deposits up to a set threshold, with a 0.25 percentage point discount applied above it. Amid the Middle East conflict, the SNB signaled a greater willingness to intervene in currency markets to prevent excessive Swiss franc appreciation and protect price stability. Inflation has edged up slightly, reaching 0.1% in February, with higher energy prices expected to push it further in the near term, though medium term pressures remain stable. The SNB forecasts average inflation at 0.5% in 2026 and 2027, and 0.6% in 2028. While global growth was solid late last year, rising energy costs and geopolitical tensions are increasing uncertainty and may slow activity. Switzerland’s economy showed modest growth, with GDP rebounding in the fourth quarter, and is expected to expand around 1% in 2026, though risks remain tied to global conditions.

The Swiss National Bank left its policy rate at 0% in its final meeting of the year and maintained the 0.25-percentage-point charge on sight deposits above the set threshold. It also reaffirmed its readiness to intervene in the foreign exchange market if needed. Inflation remained subdued, slipping to 0.0% in November from 0.2% in August due to lower prices for hotels, rents, and clothing. Assuming no change in the policy rate, the SNB expects inflation at 0.2% in 2025, 0.3% in 2026, and 0.6% in 2027. Meanwhile, Swiss GDP contracted in Q3, mainly reflecting a correction in pharmaceuticals after front-loaded exports to the US, while other industries and services posted slight gains. The SNB now sees GDP growth near 1.5% in 2025, slightly above its earlier range of 1% to 1.5%, and around 1% in 2026, compared with its previous projection of just under 1%. It also expects a modest increase in unemployment as overall economic momentum remains muted.