On 18 June 2020, the Swiss National Bank (SNB) said it would maintain its negative rate of interest (-0.75%) and remains willing to intervene more strongly in the foreign exchange market.
The coronavirus pandemic has led to a severe downturn in economic activity and a decline in inflation both in Switzerland and abroad.
The bank presented a new lower inflation forecast than the one it issued in March 2020.
The red line in the chart above shows deflation exceeding 1% this year, remaining in deflation in 2021. The yellow line is the bank’s forecast in March 2020. The forecast for the current year is negative (−0.7%). The inflation rate is likely to rise in 2021, but still be slightly negative (−0.2%), before returning to positive territory in 2022 (0.2%).