SNB’s Schlegel: We cannot exclude negative interest rates

• Inflation is well inside our target range and over our forecast cycle
• Not uncomfortable with inflation at the moment
• But cannot exclude possibility of negative interest rates
• If we have to do it, we will
• Swiss franc is traditionally treated as a safe haven
• Trade conflicts are not beneficial for Switzerland
• Ready to intervene in FX market if necessary
• Another currency cap is not something we are discussing

The challenge for the SNB now is to rein in the strength of the franc currency. The inflation picture looks to be well in control but rate cuts are still in consideration in trying to manage the exchange rate.

This article was written by Justin Low at www.forexlive.com.