The SNB announces its 20 September 2018 monetary policy meeting decision
- Prior -0.75%
- 3-month Libor lower target range -1.25%
- 3- month Libor upper target range -0.25%
Here's the statement details:
- Will remain active in the FX market as necessary
- Says that Swiss franc is highly valued
- Situation in the FX market is still fragile
- Sees 2018 growth at 2% to 2.5% (previously 2%)
- Sees 2018 inflation at 0.9% (unchanged)
- Sees 2019 inflation at 0.8% (previously 0.9%)
- Sees 2020 inflation at 1.2% (previously 1.6%)
- Economic signals for the coming months remain favourable
- Negative rates and SNB's willingness to intervene in FX market remains essential
- Sees inflation rising to 2% in Q2 2021
- Following strong growth in previous quarters, pace expected to slow slightly
No changes to the language in the Swiss franc but there is a slight moderation in inflation forecasts moving forward as well as a mention of slower growth to come. A dovish tilt on economic expectations but nothing to derail a rate hike to come once the ECB begins doing so.
But the key here is that they did not verbally attempt to weaken the swissie and they've also shown a lack of willingness in recent months to intervene too. That could set up the swissie for further gains in the medium-term.
