Swiss National Bank: No Policy Changes

September 19, 2013

SNB officials concluded their quarterly monetary policy review with no change in the stance and a statement that

  • Acknowledges lessening global financial market stress,
  • Retains an interest rate policy of virtually zero within a 3-month libor target range of 0-0.25%.
  • Pledges to do whatever it takes in the way of intervention and other steps to prevent the franc from strengthening past 1.2000 per euro.  This cap on potential exchange rate appreciation was imposed initially two years ago.
  • Revises projected GDP growth in 2013 up a half-percentage point to 1.5-2.0%.
  • Revises projected CPI inflation marginally higher but keeps such very low nonetheless.

SNB officials expect on-year CPI inflation, assuming a zero interest rate for the next three years, will not rise to 0.5% until the first quarter of 2015 or surpass 1.0% until the first quarter of 2016.  In year average terms, inflation is projected to be negative 0.2% this year, +0.3% in 2014 and 0.7% in 2015.

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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