Swiss central bank remains on alert – Reuters Germany

Zurich The Swiss National Bank (SNB) is in view of the recent flood of money through the ECB no all-clear.

you stand with interventions on the foreign exchange market and, if necessary, a further rate cut ready to prevent received another soaring franc. “We do not rule out further action,” SNB President Thomas Jordan said on Thursday in the Swiss Broadcasting. However, at present there is no need for action. Therefore, the monetary authorities always maintained its key rate at a record low of minus 0.75 percent.

The federal currency is in demand among investors, especially in times of crisis and therefore has gained importance in recent years steadily in value. The SNB will, however, prevent a sharp appreciation as last last year – because that makes Swiss goods more expensive abroad and thus weakens the export-oriented economy.

In order to achieve this goal, put the monetary authorities on the one hand to a negative interest rate (Libor) between minus 1.25 and minus 0.25 percent and on penalty interest for banks in the middle of this range at minus 0.75 percent. Secondly, they buy other currencies such as euros or dollars, in order to weaken the franc. “The willingness to intervene in the foreign exchange market is a very important pillar. It complements the negative interest rates. Both should cause us to reduce the pressure on the franc over time,” said Jordan.

In focus the SNB Governing Board has in particular the development of important export currency Euro. This had clearly lost in recent years in view of the ultra-loose monetary policy of the ECB in value. Last week, the Frankfurt central bankers had their floodgates Although further opened, but signaled simultaneously, initially to refrain from further rate cuts.

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experts had therefore saw no need for action by the SNB. Because in Switzerland, interest rates are already so low as nowhere else in the world: In the Euro zone, the so-called deposit rate is for banks at minus 0.4 percent, in Denmark at minus 0.65 percent and the Japanese rate was minus 0, 1 percent. The Swedish central bank had lowered its key interest rate recently to minus 0.5 percent. Thus, the central banks want to ensure that the commercial banks lend more and thus boost the economy – and even drive the central bank of-view to low inflation in the air.

economists do not expect that the Swiss monetary authorities have to fire their guns against another franc soar soon. “We expect the SNB keeps interest rates stable until the second half of 2017 will change,” said UBS expert Alessandro Bee. With another rate cut is expected the SNB in ​​its opinion only after a strong appreciation at a rate of 1.05 francs per euro to think. Currently, one euro cost 1.0960 Swiss francs. For Maxime Botteron of the bank Credit Suisse is decisive for the further course of the SNB especially the ECB policy. “As long as the ECB does not continue to cut interest rates, I think the SNB will not cut interest rates.”

Banned does not seem the risk of a new franc appreciation but – especially as the Swiss monetary authorities warned of the uncertain outlook for the global economy. The also have consequences for the economy in the Alpine republic: Here the SNB only expects growth of one to 1.5 percent instead of the previous 1.5 percent this year. Even its inflation forecast corrected the Swiss down: you now expect for 2016 a decline in prices by 0.8 percent. 2017 the cost of living are likely to become more expensive again by 0.1 percent.