SNB leaves policy rate unchanged at -0.75%, as expected


  • SNB leaves policy rates unchanged at -0.75% at its quarterly policy review on Thursday.
  • The decision did little to influence the Swiss franc or provide any impetus to USD/CHF.

The Swiss National Bank (SNB) announced its latest monetary policy decision this Thursday and left its sight deposit interest rate unchanged at -0.75%.

Summary of the statement

Swiss franc is highly valued.

Will remain active in foreign exchange market as necessary.

It remains willing to intervene in the foreign exchange market as necessary, while taking the overall currency situation into consideration.

Despite the recent weakening, the swiss franc remains highly valued.

With a view to stabilising economic activity and price developments, the SNB is maintaining its expansionary monetary policy.

Inflation forecast now stands at 0.2% for 2021, 0.4% for 2022 and 0.5% for 2023.

Conditional inflation forecast is based on the assumption that the SNB policy rate remains at −0.75% over the entire forecast horizon.

SNB continues to expect GDP growth of 2.5% to 3% for 2021.

Activity is thus likely to return to its pre-crisis level in the second half of the year

Production capacity will remain underutilised for some time yet.

In the current situation, both the inflation outlook as well as the growth forecasts for Switzerland and abroad are still subject to high uncertainty.

Renewed decline in GDP is to be expected for the first quarter of 2021.

Market reaction 

The SNB was universally expected to maintain status-quo and the announcement did little to provide any impetus to the Swiss franc. The USD/CHF pair held steady near multi-month tops, around the 0.9370-75 region and remained well supported by sustained US dollar buying.

About SNB Rate Decision

The Swiss National Bank conducts the country’s monetary policy as an independent central bank. It is obliged by the Constitution and by statute to act in accordance with the interests of the country as a whole. Its primary goal is to ensure price stability, while taking due account of economic developments. In so doing, it creates an appropriate environment for economic growth.

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