SNB Keeps Policy Rate at Zero Amid Subdued Inflation

The Swiss National Bank (SNB) has maintained its policy rate at zero percent, making it the lowest in the world. The decision was widely expected as inflation remains subdued, with consumer prices rising by only 0.8% in August.

The SNB expects inflation to rise to 1.2% in the fourth quarter due to higher oil prices, but then ease again in 2027. Its forecast puts average annual inflation at between 0.7% and 0.8% from 2026 to 2028, before increasing slightly to 0.9% in 2029.

The SNB argues that its current monetary stance is consistent with price stability while supporting the economy. It expects moderate economic growth of 1.5-2% this year and around 1.5% in 2027, driven by demand from abroad and a depreciating Swiss franc.