BREAKING: Swiss franc strengthens after SNB decision

The Swiss National Bank raised its benchmark interest rate by 50 bps to 1.50 % as widely expected. Policymakers said they cannot rule out additional rate increases in the near future. The prediction for inflation over the medium term would be even higher without the policy rate hike announced today. Swiss growth is likely to remain modest for the rest of the year.

SNB sees :

• 2023 Swiss growth at around 1% vs the December forecast for growth around 0.5%
• 2023 inflation at 2.6% (previous forecast was for 2.4%)
• 2024 inflation at 2.0% (previous forecast was for 1.8%)
• 2025 inflation at 2.0% and Q4 2025 growth at 2.1%

Current inflation is 3.4% and the SNB expects it to fall to 2.6% later this year. Source: Bloomberg

USDCHF pair fell after SNB decision and approaches 78.6% Fibonacci retracement of the last upward wave. Source:xStation5