- The SNB takes monetary policy on a stable course in December.
- USD / CHF remains in recovery mode intact from six-year lows.
The members of the board of the Swiss National Bank (SNB) did not announce any change in their monetary policy configuration after the conclusion of the monetary policy assessment for the December quarter on Thursday.
He SNB kept the key demand deposit rate stable at -0.75%, while the 3-month Libor target range remained stable between -1.25% and -0.25%, as widely expected.
As the SNB’s decision was in line with expected, the Swiss franc showed little reaction, with the USD/CHF keeping its recovery mode intact around 0.8840. The pair touched a six-year low at 0.8827 before the SNB announcement.
Statement summary
The Swiss franc is highly rated.
We will remain active in the forex market as needed.
In the light of highly valued Swiss franc, the SNB remains willing to intervene more strongly in the foreign exchange market.
The SNB’s expansionary monetary policy provides favorable financing conditions, counteracts upward pressure on the Swiss franc, and contributes to an adequate supply of credit and liquidity to the economy.
The revision of GDP is due to the fact that the decline in GDP resulting from the first wave of the pandemic was not as substantial as originally expected.
He forecast for Switzerland, as for the world economy, is subject to high uncertainty
The effects of the pandemic can be expected to be less than in the spring as many countries have opted for less severe containment measures.
Swiss containment measures implemented so far are restricting economic activity less than in the spring. Nonetheless, momentum is likely to be weak in Q4 2020 and Q1 2021.
We see the PIB de 2020 en -3% (vs. September forecast of -5%)
We see the inflation for 2020 at -0.7%, compared to the -0.6% forecast previously. For 2021 inflation is forecast at 0.0% (the previous forecast was 0.1%), while in 2022 it will be at + 0.2%, matching the previous forecast.
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