Swiss National Bank

December 15, 2016

The Swiss National Bank reported result of its quarterly policy review today, which ended without a change in the interest rate of -0.75% on overnight sight deposits or the pledge to intervene as needed to counter what central bank officials to be a still significantly overvalued franc. Since January 2015, intervention has been done on a subjective rather than automatic basis to defend a publicly stated ceiling against the euro. The bank’s new forecast revises downward the path of inflation by about 0.1 percentage point. From negative 0.2% this quarter, the upturn is not expected to exceed 1.0% until the spring of 2019. As late at the third quarter of that year, it is merely 1.3%. The authorities are cautiously optimistic about growth, projected a rise of around 1.5% in real GDP in 2017.

Copyright 2016, Larry Greenberg. All rights reserved. No secondary distribution without express permission.



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