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2025-11-03 17:10:28
[Switzerland Sounds the Alarm for Deflation, Negative Interest Rates Reappear] ⑴ Switzerland's Consumer Price Index (CPI) fell 0.3% month-on-month in October, marking the third consecutive month of negative growth, with the decline widening compared to the 0.2% and 0.1% drops in the previous two months. ⑵ The year-on-year increase in October was only 0.1%, with inflation approaching negative territory. Hotel accommodation, overseas package tours, and car rentals saw the most significant price drops. ⑶ Swiss National Bank (SNB) board member Petra Zuchin recently stated that while a temporary dip below zero inflation is tolerable, the bank is prepared to use negative interest rates to address persistently low inflation. ⑷ The Swiss franc weakened against the euro following the data release, with the market betting that the SNB's dovish stance will dominate policy direction. ⑸ Notably, the Harmonized Index of Consumer Prices (HICP), adjusted according to EU standards, remained flat month-on-month, providing a different perspective on deflationary trends. ⑹ Negative interest rate policies previously triggered widespread concern among savers and pension funds between December 2014 and September 2022.
