SNB keeps accommodative policy unchanged

The Swiss National Bank has kept its accommodative policy unchanged after the monetary policy assessment carried out on December 14.

The SNB’s deposit rate remains unchanged at –0.75%. The central bank will continue to buy US dollar- and euro-denominated assets to prevent the Swiss franc’s appreciation against both currencies, it says in a statement. The Swiss currency has fallen against these global currencies in recent months.

“Over the past six months, the Swiss franc has depreciated against the euro by about 7%,” Thomas Jordan, chairman of the SNB governing board, told a press conference. But the central bank considered the development was still too fragile to warrant a change of policy.

The SNB has raised its inflation forecasts, which Jordan said was mainly caused by higher oil prices and the further weakening of the franc. “For 2018, the SNB anticipates an inflation rate of 0.7%, compared [with] 0.4% last quarter. For 2019, it continues to expect inflation of 1.1%,” says the statement from the central bank.

“Given the supportive global environment and favourable monetary conditions, the recovery in the Swiss economy looks set to continue in the coming months. For 2018, the SNB expects GDP growth of around 2%, compared [with] 1% in the current year,” says the SNB.