After Tuesday’s increase: Key rate hike must continue, according to SNB-Jordan

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Jordan SRF said in the “Saturday Review” that last Tuesday’s increase was “probably” not enough. The key interest rate of 1.75 percent is still historically low. The aim of the Swiss National Bank (SNB) is to “anchor inflation permanently in the area of ​​price stability”.

But they don’t just use the interest rate tool to fight inflation: in recent years, the SNB has allowed the franc to appreciate in nominal terms and has sold foreign currency to do so. This protected Switzerland from imported inflation.

Regarding criticism of the Swiss union federation, Jordan said that alternatives to raising interest rates should always be considered: then inflation would continue to rise and monetary policy would be tightened further later on.

understand the tenants

He believes the SNB chooses the right frequency in smaller steps. They can assess how inflation is developing in the fall and what else is needed.

Of course he has a great sense of tenants: Nobody likes to pay more. However, there is now a regulation in Swiss tenancy law that higher interest rates can be reflected in rents. But if they had waited longer to raise interest rates, the negative impact on tenants could have been much greater.

The vicious cycle of higher rents and subsequent higher inflation will only be short-term. Because with tight monetary policy, inflation will not increase any more.

CS takeover is not an issue of course

Jordan also advocated the acquisition of CS by UBS. Because this meant that there was no financial crisis either in Switzerland or around the world. Nobody lost money, all lines of credit were still available, and there was no contamination of other banks or the international banking system.

The fact that the measures worked that way was anything but a matter of course. On Sunday, March 19, they were still unsure. Jordan described the result as a “very good result” without the financial crisis and without destabilizing Switzerland.

Currently, UBS’s SNB financing is still crucial so that the new bank’s restructuring can run as efficiently as possible. The aim is that outstanding loans can be repaid “relatively fast”.

Source :Blick