HomeFinancial MarketsSwiss National Bank Hikes Interest Rate By 75 Points

Swiss National Bank Hikes Interest Rate By 75 Points

The Swiss National Bank raised its interest rates by 75 points on Thursday—only its second increase over the last 15 years. This hike comes as it joins other European central banks in an effort to curb drastically rising prices.

As was expected by economists polled by Reuters, the Swiss National Bank raised its policy rate to 0.5% from the minus 0.25% that it had set in June. Previously, the policy rate had been frozen at 0.75% for years in an attempt to slow down the appreciation of the Swiss franc.

According to the Swiss central bank, the decision to raise policy rates has been effective at minimizing the rise in the cost of goods and services across the board. It warned, however, that further interest rate increases may be necessary over the medium term in order to ensure price stability.

In addition to interest rate hikes, the Swiss National Bank is also considering becoming more active in the foreign exchange market. The central bank added that it will continue to adjust its monetary policy in accordance with its interest rate changes. “This ensures that the secured short-term Swiss franc money market rates remain close to the SNB policy rate. Banks’ sight deposits held at the SNB are remunerated at the SNB policy rate up to a certain threshold. Sight deposits above this threshold are remunerated at an interest rate of zero percent. The SNB will also use liquidity-absorbing measures,” the bank confirmed.

Euro Steadies as ECB President Promises Further Rate Hikes

The euro remained steady on Thursday after European Central Bank (ECB) President Christine Lagarde announced that further interest rate hikes would be implemented as...

Stocks Rise as House Passes Debt Ceiling Deal

U.S. stocks advanced on Thursday morning after the House of Representatives passed a bill proposing to raise the government's debt ceiling on Wednesday evening....

Macy’s Shares Fall After Annual Forecast Cut

Macy's Inc cut its full-year earnings and profit forecast after experiencing a slowdown in demand for its high-end products. The retailer's shares declined by...