The Swiss National Bank cut interest rates on Thursday, becoming the first to do so among the major central banks, stressing that the battle against inflation was working almost two years after launching its monetary tightening campaign.
The SNB eased its monetary policy and cut its rate by 0.25 percentage points to 1.5 percent, effective from Friday, in its first interest rate cut since it began to hike them in June 2022.
Amidst a busy month, the Federal Reserve on Wednesday held US interest rates steady, but left open the door to three interest rate cuts before the end of the year.
SNB chief Thomas Jordan explained that the decision to cut now was not to move before other central banks, but because it was “the right time” for Switzerland.
“The easing of monetary policy has been made possible because the fight against inflation over the past two and a half years has been effective,” the central bank said in a statement.
“For some months now, inflation has been back below two percent and thus in the range the SNB equates with price stability.” He said.
According to the SNB, global economic growth was likely to remain moderate in the coming quarters, while inflation was likely to decline further.