The Swiss National Bank (SNB) may raise interest rates again in December to fight inflation. However, the short-term economic outlook has clouded over in Switzerland as well. As in other countries, the level of uncertainty is high.
In an international comparison, inflation is low in Switzerland. Swiss National Bank Director Thomas Jordan (59) still believes tighter monetary policy is needed. He announced this to the Federal Council at a meeting.
The war against inflation is not won
In an interview with the business newspaper L’Agefi, SNB Board member Andréa Maechler (53) says inflation is still very high. He underlines that the fight against inflation has not yet been won, although it fell to 3.0 percent in October. “We will declare victory if inflation permanently drops below 2 percent.”
The Deputy Director adds: “It cannot be excluded that further rate hikes will be needed according to the new figures and developments to ensure price stability in the medium term.”
Not only Ukraine and the pandemic
Because: According to the Deputy Director of the SNB, there is growing evidence that price increases are not limited to goods and services affected by the war in Ukraine or the consequences of the pandemic. “We also know that electricity prices will rise quite sharply in the coming months,” Maechler explains.
The SNB has already raised interest rates twice this year. The key interest rate of the SNB is currently 0.5 percent. (pbe/SDA)