August 9, 2022

• On 16 June 2022, the Swiss National Bank (SNB) decided to tighten its monetary policy. It raised the SNB policy rate by half a percentage point to –0.25% to counter increased inflationary pressure. The conditional inflation forecast was above that of March, and would have been even higher without the rise in the policy rate.

• Global economic growth slowed from the beginning of 2022 onwards, and inflation rose further in many countries. In its baseline scenario, the SNB anticipates the positive economic development continuing overall. Inflation is likely to remain high for some time, but the SNB’s assumption is that it will return to more moderate levels over the medium term.

• The Swiss economy continued its favourable development. The SNB still expects GDP growth of around 2.5% for 2022. The level of uncertainty associated with the forecast remains high.

• Annual CPI inflation continued to rise, and stood at 2.9% in May. The longer-term inflation expectations derived from the surveys were somewhat higher than in the previous quarter, but still within the range compatible with price stability.

• The Swiss franc depreciated in trade-weighted terms. There was an increase in long-term interest rates, whereas share prices fell. Real estate prices rose. Growth in monetary aggregates slowed further. There was scarcely any change in lending growth.

Source: Swiss National Bank (SNB) – Quarterly Bulletin – 2 / 2022 June
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