The Swiss National Bank announced the third rate cut this year, saying that it may cut interest rates further in the future.

Considering the steady cooling of inflation and the continued strength of the Swiss franc, the Swiss National Bank maintained the pace of interest rate cuts of 25 basis points.

On Thursday, September 26th, Beijing time, the Swiss National Bank announced the latest interest rate resolution, announcing that the benchmark interest rate would be lowered by 25 basis points to 1.00%, which was the third consecutive rate cut, in line with market expectations.

According to the resolution statement, considering that the inflationary pressure has dropped significantly compared with the previous quarter, a loose resolution was made. In the next few quarters, it may be necessary for the bank to further reduce the policy interest rate to ensure the stability of the neutral interest rate.

Driven by the geopolitical crisis, the Swiss franc exchange rate has continued to rise since the middle of this year. The statement said that it will be prepared to intervene in the foreign exchange market if necessary.

After the announcement of the resolution, the exchange rate of the Swiss franc jumped in a short time, and then retreated some of the gains. The USD/CHF fell by 0.12% to 0.8494.

In the past quarter, inflation pressure in Switzerland has slowed down significantly, and economic growth has recovered moderately.

According to the latest inflation data, Switzerland's CPI rose by 1.1% year-on-year in August, which was slower than expected and far below the 2% inflation target set by the bank, mainly driven by the falling prices of imported goods and services.

At the same time, Switzerland's GDP grew steadily in the second quarter, and the overall capacity interest rate remained at a normal level, indicating a steady economic recovery.

In addition, the Swiss national bank also lowered its inflation forecast for the past three years, saying that it is mainly due to the strength of the Swiss franc, the fall in oil prices and the downward adjustment of electricity prices in January next year.

It is estimated that the average annual inflation rate will be 1.2% in 2024, 0.6% in 2025 and 0.7% in 2026.

The forecast is based on the assumption that the policy interest rate of the Swiss National Bank is 1.0% throughout the forecast period. Without today's interest rate cut, inflation expectations will be lower.

Risk warning and exemption clause

The market is risky and investment needs to be cautious. This paper does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation or needs of individual users. Users should consider whether any opinions, viewpoints or conclusions in this article are in line with their specific situation. Invest accordingly at your own risk.