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- SNB's Jordan: Negative rates will remain an important instrument, to be used if needed
SNB's Jordan: Negative rates will remain an important instrument, to be used if needed
Following the Swiss National Bank's (SNB) decision to hike its policy rate by 75 bps on Thursday, Chairman Thomas Jordan noted that “negative rates will remain an important instrument, to be used if needed.”
Additional takeaways
Overall negative interest rate policy has proven its worth.
Franc's recent appreciation has helped to dampen inflation.
Without policy rate increase, forecast inflation would be significantly higher.
Further increases in policy rate cannot be ruled out.
SNB ready to intervene to prevent excessive weakening or strengthening of franc.
Swiss inflation likely to remain elevated for some time.
There are growing signs Swiss inflation is spreading to goods and services not affected by Ukraine war.
Market reaction
USD/CHF has paused its upsurge, consolidating at around 0.9772, as investors digest comments from the SNB Chief. The pair is gaining 1.16% on the day.
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