SNB Chairman Martin Schlegel said that while the central bank does not favor negative interest rates, it remains fully prepared to reintroduce them if necessary.
Speaking at an event today, Schlegel said “if we have to do it, the negative interest rates, we’re certainly prepared to do it again”.
“For the last couple of quarters, we have always said we are ready to intervene in the forex market if it’s necessary,” Schlegel said.
The comments come just a day after Swiss CPI data revealed that inflation slowed to 0% in April — the lowest reading in four years. The data has triggered market expectations that SNB will cut its policy rate from the current 0.25% at its upcoming meeting on June 19. Expectations are also mounting that rates could eventually fall back below zero this year.
