Introduction to the Swiss National Bank’s Latest Decision
The Swiss National Bank (SNB) has released the minutes of its latest rate-setting meeting, which took place on December 11. As expected, the SNB left its policy rate unchanged at 0%, maintaining the lowest interest rate among the world’s major central banks.
Expectations for Inflation
The SNB’s policymakers expect inflation to revive gradually over time. According to their forecasts, inflation will average 0.3% in 2026 and 0.6% in 2027. This is in line with the SNB’s target of 0-2% inflation, which it refers to as price stability. Although inflation has declined in recent months, the SNB believes it will increase again over the course of the forecast period.
Interest Rates Remain Unchanged
The SNB saw no reason to alter interest rates, as the current monetary conditions are considered appropriate. This means that neither increasing nor decreasing interest rates was seen as necessary. The SNB’s neutral stance on interest rates suggests that it is unlikely to make any changes in the foreseeable future.
Economic Outlook
The economic outlook has improved slightly due to the reduction in U.S. tariffs on Swiss goods from 39% to 15%. This reduction has had a positive impact on the Swiss economy, which experienced swings in economic growth during 2025. The SNB notes that the compensations for the tariffs are now expected to have been completed, which should lead to more stable economic growth.
Expert Opinion
Karsten Junius, an economist at J.Safra Sarasin, believes that the SNB’s minutes show a neutral stance on interest rates. He expects no changes to interest rates for the next 18 months, as the SNB is unlikely to cut or hike rates.
Conclusion
In conclusion, the Swiss National Bank’s latest decision to leave interest rates unchanged at 0% is based on its expectation that inflation will revive gradually over time. The SNB’s neutral stance on interest rates suggests that it is unlikely to make any changes in the foreseeable future. With the economic outlook improving slightly due to the reduction in U.S. tariffs, the SNB is confident that the current monetary conditions are appropriate. As a result, interest rates are likely to remain unchanged for the next 18 months.
