Swiss National Bank keeps rates on hold

18th Jun 2026 10:38

(Sharecast News) - The Swiss National Bank left interest rates unchanged on Thursday, as widely expected, on a benign inflationary outlook.

The central bank opted to keep policy rate at 0%. It acknowledged that inflation had risen in recent months, coming in at 0.6% in May compared to 0.1% in February, due to higher energy prices. But medium-term inflationary pressures were "virtually unchanged" since its last report, it added.

The SNB expects inflation to continue increasing slightly over the coming quarters before moderating in the first half of 2027, as energy prices fall. "Energy prices will be largely influenced by the further development of the situation in the Middle East," it noted.

It also flagged resilient domestic economic activity, despite conflict in the Middle East, with the main risk to the country's economic outlook developments in the global economy.

"In particular, the situation in the Middle East could worsen again and curb global economic activity more strongly," it said. "The upward pressure on the Swiss franc could also increase. Furthermore, US trade policy continues to be a source of uncertainty."

ING said the SNB had struck a "relaxed" tone on inflation. It continued: "Energy prices have of course increased in Switzerland, as elsewhere. However, the strength of the Swiss franc continues to exert significant disinflationary pressure.

"While early-year deflation concerns have eased, the risk of a significant inflation pick-up in the coming months appears limited. Overall, the outlook remains benign, with inflation comfortably within the SNB's target range.

"We expect policy rates to remain at 0% for at least the next two years."