SNB kept sight deposits rate unchanged at -0.75%. Also, “in light of the highly valued Swiss franc, the SNB remains willing to intervene more strongly in the foreign exchange market”.
In the baseline scenario, SNB expects the pandemic to be “brought back under control in the foreseeable future”. Global recovery should therefore “regain momentum in the course of next year”. But production capacity will be “unfertilized for some time” and inflation will remain modest in most countries.
For Swiss, SNB expects GDP to contract by around -3% this year. GDP will then grow 2.5% to 3.0% for 2021, but recovery remains “incomplete”. Conditional inflation forecast through the end of 2021 is revised slightly lower, “primarily due to the renewed deterioration in the economic situation as a result of the second wave of the pandemic”. Overall inflation would be at -0.7% in 2020, 0.0% in 2021, and 0.2% in 2022.
