The Swiss central bank expects to raise rates by 50 basis points in September
A Swiss tabloid said on Saturday, citing unnamed sources, that the Swiss National Bank plans to hike interest rates by 50 or 75 basis points in its next planned monetary policy announcement in September.
After 15 years, the Federal Reserve finally increased its policy interest rate last month, and Federal Reserve Chairman Thomas Jordan quickly warned that more tightening would likely be required due to persistent inflationary pressure.
Inflation in Switzerland reached 3.4% in June, the highest level in over three decades and the first time it has been above 3% since 2008. Inflation has remained above the SNB’s 0-2 percent target range for the past five months.
Switzerland’s weekend newspaper, Schweiz am Wochenende, reported that the central bank was planning to increase interest rates by 50 basis points, from -0.25 percent to 0.25 percent, during its next monetary policy announcement on September 22. It made reference to an unspecified number of individuals who were apparently participating in the event.
It was also mentioned that a rate hike of 75 basis points is possible if inflation were to climb further.
The European Central Bank’s Governing Council is expected to vote to raise interest rates on Thursday, September 21, prompting speculation that the Swiss National Bank (SNB) may follow suit the following day.
When asked about the story, an SNB representative reportedly declined to comment because the bank does not address rumours.