Key Takeaways:
The Swiss National Bank (SNB) is not expected to reintroduce negative interest rates at its policy meeting this week.
A survey of 24 economists shows almost all anticipate the SNB will hold steady on Thursday.
SNB officials, including President Thomas Jordan, have stressed readiness to act if necessary, but negative rates carry higher risks for the financial system.
Analysts point to rising inflation trends as a reason the SNB is likely to stay on hold.
The Swiss National Bank’s (SNB) threat to cut borrowing costs back into negative territory may not materialize this week, according to economists surveyed by Jinshi Data. Nearly all of the 24 economists polled expect policymakers to avoid cutting rates below zero at Thursday’s decision.
While SNB President Thomas Jordan and his colleagues have repeatedly emphasized their willingness to return to negative interest rates if conditions demand it, analysts note the bar for such a move remains high. Unlike conventional rate adjustments, negative rates risk distorting the banking sector and damaging financial stability.
According to J. Safra Sarasin, chief economist at Bank, inflation in Switzerland is already well above zero and trending upward, reducing the likelihood of a policy reversal into negative territory.