Swiss National Bank president hints at rate hike to tackle inflation – business and finance
ZURICH: The Swiss National Bank may raise interest rates to tackle inflation that remains above target, President Thomas Jordan said in an interview published on Saturday.
Jordan defended the central bank’s commitment to price stability, which he defined as inflation below 2%, but in positive territory, in a Swiss newspaper article corriere del ticino,
“While most central banks have an inflation target of around 2%, the SNB is a bit more conservative,” Jordan said. “The 2% target is not a dogma, nor the wish of any special interest group.
“Obviously if inflation exceeds the target, monetary policy should be restrictive,” Jordan told the newspaper.
Swiss annual inflation fell to 2.2% in May, government data showed on Monday, but remains above the 0-2% range targeted by the SNB through February 2022.
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The SNB is expected by analysts and the market to raise interest rates at a meeting on June 22, despite a lack of recent price increases in Switzerland.
Earlier this week, Jordan said in a separate public appearance that he could not rule out a tightening of monetary policy to tackle Swiss inflation.
In newspaper interviews, Jordan said that price stability created the best environment for economic growth, and that it was important for social stability and fairness.
“When inflation is above 2%, low-income people suffer especially,” Jordan told the newspaper. “So it’s a matter of social justice.”