Swiss National Bank Vice President Martin (Antoine Martin) stated on Thursday that the Swiss National Bank may cut interest rates again this year because the Swiss economy is growing moderately and the inflation rate is low.
"Due to Switzerland's relatively low inflation rate, and faster economic growth, this tends to lead to a reduction in policy rates," Martin said at an event organized by the Swiss Financial Analysts Association in Zurich.
Martin mentioned comments from other officials of the Swiss National Bank who indicated last month that there might be another interest rate cut. Martin added, "There is never any commitment."
The Swiss National Bank has been at the forefront of interest rate cuts, having cut rates three times this year, bringing the rate down to 1.0%.
Over the past 15 months, Swiss inflation has remained within the target range of 0-2% for the central bank, allowing for interest rate cuts. Prices rose by 0.8% in September, the lowest level in over three years.
Martin stated that the Swiss National Bank may eventually consider lowering rates to negative values, aligning with remarks from Swiss National Bank President Schlegel last week. He mentioned that maintaining the interest rate differential with other central banks is a key factor affecting exchange rates, which in turn can affect inflation.
"Despite this, because the current inflation rate is 'firmly' within the target range, the Swiss National Bank's situation is still relatively comfortable," said Martin.
"In some imaginable scenarios, we would use this tool, as it is a particularly useful tool," Martin said regarding negative interest rates, "but we are not considering this today."