The Swiss National Bank (SNB) cut its key interest rate to zero percent on Thursday, down from 0.25%, due to easing inflation. Swiss consumer prices even saw a slight annual decline of 0.1% in May.
The SNB attributes this drop in inflation primarily to lower prices in the tourism and oil sectors. They project inflation to be 0.2% this year, rising to 0.5% in 2026 and 0.7% in 2027, assuming their interest rate stays at zero.
The bank expects global economic growth to slow, with inflation likely to rise in the US but continue to decrease in Europe. Switzerland, however, experienced strong economic growth in the first quarter, largely driven by increased exports to the US as companies preempted potential future tariffs.
Meanwhile, the US Federal Reserve held its interest rate steady, awaiting more data on the economic impact of tariffs and other potential disruptions, despite calls from President Trump to lower rates.
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