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2025-11-03 15:44:44
[Swiss Inflation Unexpectedly Slows to Near Zero, Putting Pressure on Central Bank] 1. Swiss inflation unexpectedly slowed to near zero, putting pressure on the central bank and forcing it to take measures to address the strong Swiss franc and boost price growth. Data shows that the CPI rose 0.1% year-on-year in October, lower than the previous month's 0.2% and also lower than the market expectation of 0.3%. One pressing issue facing the Swiss National Bank is that the safe-haven currency status of the Swiss franc has pushed it to its highest level in nearly a decade, and this strength could potentially curb inflation by lowering import costs. 2. Core inflation also unexpectedly slowed last month, falling from 0.7% to 0.5%. The latest data will frustrate SNB President Schlegel and other officials, who had predicted that inflation would accelerate by the end of this year and early 2026. The failure of price growth to recover from the lower end of the 0-2% target range will further complicate the task for policymakers in the face of a strong Swiss franc. 3. The SNB can choose to intervene in the foreign exchange market, which would expand its balance sheet and anger the United States, or to adopt a negative interest rate policy, but this could harm the financial system.
