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Swiss Central Bank Hikes Interest Rate to Negative 0.25 Percent to Contain Inflation

Proof of central bank incompetence is nearly everywhere one looks.
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Swiss National Bank interest rate courtesy of Trading Economics

Swiss National Bank interest rate courtesy of Trading Economics

Reuters Poll

On June 14, Reuters reported the Swiss National Bank to leave rates steady in June, raise 25 bps in Sept: Reuters Poll 

Surprise Hike to Negative 0.25 Percent 

In a Surprise Move on June 16, SNB Chairman Thomas Jordan said rising Swiss inflation - which hit its highest level in nearly 14 years in May - meant the central bank may have to act again.

"Without today's SNB policy rate increase, the inflation forecast would be significantly higher," Jordan told a news conference.

"We are not in the business of very precise forward guidance, but ... at the end of our forecast horizon inflation will again go over 2% so we have to see what measures are necessary," Jordan said.

No Leaks!

Unlike the US where the WSJ reported a leak in a blackout period just two days before the Wednesday announcement, the Swiss National Bank does not engage in forward guidance or last second leaks to existing guidance. 

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This post originated at MishTalk.Com.

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