ZURICH (Reuters) – The Swiss Nationwide Financial institution will proceed to focus on low inflation because the touchstone of its financial coverage, Chairman Martin Schlegel stated on Friday, underlining continuity with predecessor Thomas Jordan who stepped down in September.
Schlegel careworn retaining inflation inside a spread of 0-2% – which the central financial institution calls worth stability – as a key issue for the Swiss financial system’s robust efficiency in recent times.
After a post-pandemic spike, inflation has returned to the goal vary over the past 17 months, and fell to its lowest degree in additional than three years in October.
The downward pattern has stoked market expectations of extra rate of interest cuts by the SNB this 12 months and into 2025 to move off deflationary dangers.
“The Swiss financial system has carried out nicely by worldwide comparability,” Schlegel instructed an occasion in Zurich.
“The SNB has contributed to this efficiency by sustaining worth stability regardless of important deflationary and inflationary dangers,” he stated. “Going ahead, the SNB will proceed to contribute to beneficial financial situations in Switzerland by guaranteeing worth stability.”
The feedback echo Jordan’s constant messaging on inflation throughout his 12-year stint in cost.
Schlegel, who started his profession on the SNB in 2003 and labored as a researcher for Jordan, was broadly seen because the financial institution’s continuity candidate.
He stated the SNB wanted a versatile inflation goal as a result of Switzerland being strongly affected by international financial tendencies. He additionally famous it has a safe-haven forex, which tended to understand throughout downturns.
Schlegel stated the SNB’s most important instruments had been its coverage rate of interest, in addition to forex market interventions.
The SNB’s goal vary allowed the central financial institution to reply flexibly to shocks and determine how one can act, Schlegel stated.
