SNB Chair Martin Schlegel said on Monday that while the central bank is reluctant to reintroduce negative interest rates, it cannot rule them out entirely.
He stated, “negative interest rates have served their purpose, but it is not something the SNB would do lightly,” .
Schlegel also downplayed the risks of deflation, noting that occasional months of negative inflation “is not a problem”.
“Our concept is price stability over the mid term,” he emphasized.
Markets currently see 64% chance of SNB cutting rates from 0.5% to 0.25% in March, with a 27% likelihood of a further cut to 0% by June.
