The Swiss National Bank has lowered its key interest rate once again. The SNB key interest rate has fallen by 0.50 percentage points and now stands at 0.50 percent.
No time? blue News summarizes for you
- The Swiss National Bank cuts the key interest rate by 0.50 percentage points.
- blue News shows the livestream of the SNB’s media conference from 10 a.m.
- The European Central Bank is also announcing its new key interest rate today. Many economists also expect the ECB to cut rates.
Today’s trading day is dominated by the interest rate meetings of the Swiss National Bank SNB and the European Central Bank ECB.
The SNB is leading the way by lowering its key interest rate by 0.50 percentage points, as its president Martin Schlegel has just announced. The new interest rate at which the Swiss National Bank lends money to commercial banks is 0.50 percent.
Further interest rate hikes are possible: the SNB will continue to monitor the situation closely, according to the communiqué published on Thursday. The SNB will adjust its monetary policy if necessary to ensure that inflation remains within the price stability range of 0 to 2 percent in the medium term. If necessary, the SNB is also prepared to remain active on the foreign exchange market.
Inflationary pressure has eased
After the last assessment of the situation, the choice of words was even clearer. At that time, it was stated that further interest rate cuts could become necessary in the coming quarters.
The underlying inflationary pressure has decreased again this quarter, according to the current interest rate move. With today’s easing of monetary policy, the SNB is taking this development into account.
The SNB had already lowered the key interest rate by 25 basis points in March, June and September. Previously, the central bank had raised the key interest rate from -0.75% in June 2022 to 1.75% in just five steps and then left it unchanged twice.
The impact of interest rate cuts
In the medium term, lower key interest rates mean that savings deposits earn less. Property owners, on the other hand, can hope for cheaper mortgage loans.
If key interest rates continue to fall, tenants will also benefit. If the SNB’s interest rate affects the Confederation’s mortgage reference rate, those tenants whose rent is based on the higher reference rate are entitled to a reduction in their payment to the owner.
Low interest rates generally stimulate the economy, as companies can obtain capital more cheaply. This is why interest rate cuts are also seen as good news on the stock market and for share owners, raising hopes of price gains.
Meanwhile, many economists agree that further steps will follow in 2025, regardless of the amount of the upcoming cut. Negative interest rates cannot be ruled out in the medium term either.
SDA/smi
