Imperial Wealth Planning’s Post

In this post, I discuss the challenges of the SNB after cutting rates two weeks ago. Given the exposure to the Euro area, the ECB's policy message and actions will be relevant for the CHF and future policy decisions by the SNB. Are we back to the expansions of SNB's balance sheet as in the pre-Covid period? #SNB #monetarypolicy #inflation #Switzerland #ECB

At its latest meeting in June, the Swiss National Bank (SNB) decided to cut its policy rate for the second time this year, bringing it down to 1.25%. We expect one final rate cut in September, although it could come later. Swiss bond yields fell in the wake of the French election announcement and SNB meeting in June. But after reaching a low of 0.54% at the end of June, the 10-year Swiss government bond yield had rebounded to 0.65% by 8 July, after the French election. Taking into account the additional SNB rate cut that we now expect, we are lowering our year-end forecast for the 10-year Swiss sovereign bond yield from 0.9% to 0.7%. We therefore remain underweight Swiss bond duration because of the low yields on offer and because the inverted yield curve makes short-dated Swiss bonds more attractive. #Swiss #bond #rate

Will the Swiss National Bank (SNB) intervene in the FX market if the Swiss Franc (CHF) appreciates further? The simple answer is yes. In this speech from last April, the Vice Chairman of the governing board of the SNB explains their currency intervention policy. "Switzerland earns every second Swiss franc abroad. For good reason, the export sector is said to be the engine of the Swiss economy. Because the exchange rate affects inflation and the economy, it plays a key role for our monetary policy. To maintain price stability, we influence monetary conditions. They are determined by interest rates and the exchange rate. To maintain appropriate monetary conditions, we set the SNB policy rate. We can also influence monetary conditions through further monetary policy measures, for example foreign exchange interventions. The SNB policy rate remains at the core of our monetary policy implementation. It directly influences interest rates in general and – indirectly – the exchange rate. If necessary, we intervene in the foreign exchange market. This influences the exchange rate directly. " #CHF #Switzerland #SNB

SNB intervention? The Swiss National Bank can intervene in currency markets if required and stands ready to lower interest rates again, according to new President Martin Schlegel. “Our main instrument is the policy rate — but we’re not excluding to be active on FX markets,” he said in his first speech as SNB chief on Tuesday. The central bank last week reduced borrowing costs for a third straight meeting and signaled that more easing may follow. While not pre-committing to further cuts, Schlegel had told Bloomberg Television that such moves are “likely.” Meanwhile, the franc has been rallying and some analysts believe it may reach the strongest level in almost a decade. Schlegel said that the “for the competitiveness of Switzerland the real exchange rate is relevant, not the nominal one.” #snb #switzerlanch #chf #swissfrancs #rates #economy source : bloomberg

🔸SNB Unexpectedly Lowers Interest Rate from 1.50% to 1.25%🔸 Today, it was announced that the Swiss National Bank (SNB) decided to lower the interest rate to 1.25%. According to ForexFactory, the analyst consensus had expected the rate to remain at 1.50%, making this decision a surprise. According to SNB Chairman Thomas Jordan: → Inflation in Switzerland is decreasing; → In recent weeks, the Swiss franc has significantly strengthened due to geopolitical tensions, and the SNB is prepared to be active in the Forex market if necessary. The market's reaction to the SNB's decision and the statements from its chairman resulted in a sharp weakening of the Swiss franc. Specifically, the USD/CHF rate rose by approximately 0.7% in the first few minutes. What could this mean for the future of Swiss monetary policy? 🔗Read the full article: https://cutt.ly/Jeaj8kPE CFDs are complex instruments and come with a high risk of losing your money. #USDCHF #marketanalysis #tradingtips #forextrading

‘Just three years into his tenure, the SNB triggered a major economic crisis in Switzerland. On January 15 2015, the bank announced it was abandoning its policy of keeping the franc pegged to the euro, triggering a 30 per cent surge in the Swiss currency’s value. The rest of Jordan’s tenure was spent battling to keep the value of the franc down — a huge challenge because of Switzerland’s role as a financial haven in an era of successive international political and financial crises, and loose monetary policy in the US and eurozone. To do so, Jordan presided over an unprecedented period of unorthodox monetary policy. The SNB put its baseline interest rate into negative territory in 2015, and kept it there for nearly eight years. One side effect of the policy was a sustained period of underperformance for Switzerland’s large banking sector, whose margins across its traditional core businesses — catering to Swiss savers and taking deposits from the world’s wealthy — were squeezed, arguably pushing some banks and their clients into riskier but higher margin fields of financial speculation.‘ https://lnkd.in/gXXGPVK9

The Swiss National Bank (SNB) has reported an annual loss of 3.2 billion Swiss francs for 2023, marking a significant financial setback attributed to the impact of rising interest rates. With monetary policy adjustments aimed at addressing inflationary pressures, the SNB's transition away from negative rates has presented unexpected challenges, contributing to the substantial loss. Despite this, the bank remains resolute in its commitment to fulfilling its monetary policy mandate. Read more: https://lnkd.in/dzF5GCcm #SwissNationalBank #Finance

📢 Exciting news in the finance world! The Swiss National Bank has reduced its key policy rate by 25 basis points to 1.25% from its previous level of 1.50%. This move is significant and is likely to have a profound impact on the financial markets. Stay informed and follow along for more insights and analysis. #SwissNationalBank #InterestRateCut #FinanceUpdate https://ift.tt/xfWGU7F

Curious about how the Swiss National Bank has managed inflation over the last 15 years? Maxime Botteron, UBS Swiss Economist, explains how the SNB has been stabilizing the Swiss franc, adjusted the policy rate and intervened in the foreign exchange market. Watch the video to learn more, especially ahead of the next SNB rate decision tomorrow. #shareUBS

The Swiss National Bank cut borrowing costs by a quarter point at a third straight meeting and warned of more to come if needed in its attempt to contain the strength of the franc. Despite market speculation that officials in Zurich would follow the US Federal Reserve Board’s lead with a half-point reduction, they shirked from any acceleration in easing. The interest rate is now 1% after a 25 basis-point move on Thursday that was predicted by most economists surveyed by Bloomberg. by Bastian Benrath-Wright #Switzerland