Swiss National Bank flags economic uncertainty after latest rate cut.

By Jerry  Published On March 20, 2025
The Swiss National Bank cut its main interest rate to just above zero on Thursday and flagged increased uncertainty over the global impact of U.S. President Donald Trump’s trade policies.
The SNB reduced its policy rate by a quarter point to 0.25%, its fifth successive cut since it started lowering borrowing costs in March 2024, after deciding inflation was well contained and could decline further.
The decision came on a busy day for central banks, with the Bank of England and Sweden’s central bank both keeping their key interest rate unchanged.
The U.S. Federal Reserve on Wednesday also held interest rates steady, citing a period of “unusually elevated” uncertainty linked to Trump’s initial policies, including tariffs, which it said could both dampen growth and lead to price rises.
Schlegel said the outlook for Swiss inflation was also unclear, with the risks mainly pointing down due to weaker global economic growth and a possible rise in the value of the safe haven Swiss franc.
The new 0.25% rate is the SNB’s lowest since September 2022, and brings it close to sub-zero interest rates again, a move it has previously not ruled out.
Schlegel was cautious about the SNB’s future path, saying the bank would only decide its future policy after analysing data before its next meeting in June.
Source: Reuters

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