Monetary policy assessment of 17 September 2015
Central bank: snb | Type: statement | Date: 2015-09-17

Monetary policy assessment of 17 September 2015
unchanged at between −1.25% and –0.25%. The interest rate on sight deposits with the SNB
remains at –0.75%. Furthermore, the SNB will remain active in the foreign exchange market
as necessary, in order to take account of the impact of the exchange rate situation on inflation
and economic developments. Overall, the Swiss franc is still significantly overvalued, despite
a slight depreciation. The negative interest rates in Switzerland and the SNB’s willingness to
intervene as required in the foreign exchange market make investments in Swiss francs less
attractive; both of these factors serve to ease the pressure on the franc.
Overall, the new conditional inflation forecast differs very little from that in the June
assessment. Owing primarily to the drop in oil prices, the forecast for the short term is
somewhat lower than that presented in the previous quarter. For the current year, the forecast
decreases by 0.2 percentage points to −1.2%; for 2016, it drops from −0.4% to −0.5%. The
SNB continues to expect inflation to move back into positive territory at the beginning
of 2017. Averaged over the year, the conditional inflation forecast for 2017 increases by
0.1 percentage points to 0.4%. The forecast assumes that the three-month Libor will remain
at –0.75% over the entire forecast horizon and that the Swiss franc will weaken further.
Global economic growth continued in the second quarter in line with the SNB’s expectations.
In the advanced economies, growth was slightly more positive than in the first quarter; this
was mainly attributable to the economic recovery in the US. The muted recovery in the euro
area continued, due partly to the favourable exchange rate situation. Internationally, however,
growth was not broad-based. This was reflected, for instance, in the lack of momentum in
global trade and in low commodity prices.
The SNB expects the moderate pace of global economic recovery to continue. In the advanced
economies, the recovery is likely to be underpinned by monetary policies which are still very
expansionary, as well as favourable energy prices. Consequently, underutilisation of
Zurich, 17 September 2015
Press release
production capacity should decrease further in these countries. In a number of the major
emerging economies, however, activity remains weak.
The global economic recovery is fraught with risks. In particular, uncertainty regarding
economic developments in China has increased perceptibly. By contrast, the agreement of a
new bailout programme for Greece has soothed concerns over an escalation of the sovereign
debt crisis for the time being. Renewed turbulence in the international financial markets could
have a major impact on global monetary policy.
In Switzerland, GDP rose slightly in the second quarter, after having declined somewhat in
the previous quarter. Thus, overall economic output stagnated in the first half of the year.
Growth in employment continued at a slower pace. However, in manufacturing, employment
decreased further. The seasonally adjusted unemployment rate continued to increase slightly
during the summer months. Despite the fact that output remained stable overall following the
appreciation of the Swiss franc in the first half of the year, the situation remains challenging
for many companies. In view of the lower margins, these companies are under pressure to
raise efficiency and reduce costs.
The SNB expects economic activity to pick up gradually in the second half of the year.
Domestic demand is likely to further support the economy. If the international environment
continues to improve and the overvaluation of the Swiss franc eases, exports should once
again make a greater contribution to economic growth. For the current year, the SNB still
expects real GDP growth of close to 1%.
Zurich, 17 September 2015
Press release