DBS Group Research economist Philip Wee anticipates that the Swiss National Bank (SNB) will maintain its policy rate at 0% during the September 24 meeting, despite recent increases in energy prices and a modest rise in headline inflation [1]. Wee notes that there is potential for the SNB to upgrade its near-term inflation forecast, as elevated energy prices continue to impact the economy and uncertainty persists in the Middle East [1]. The SNB is also expected to focus on second-round effects, such as those in processed food, transport, tourism, and restaurants, as highlighted in its June minutes [1].
The likelihood of a hawkish shift in the SNB's forecast will depend more on whether the central bank perceives the oil shock as influencing underlying inflation, rather than just higher near-term inflation figures [1]. In June, the SNB expressed an increased willingness to intervene in foreign exchange markets to counter rapid and excessive appreciation of the Swiss franc (CHF), citing concerns over price stability and the impact on Switzerland's export-led economy [1]. However, these concerns have since diminished, with the CHF giving up more than half of its post-Liberation Day gains against the euro (EUR) and British pound (GBP) [1].
Economic growth in Switzerland has shown improvement, with the State Secretariat for Economic Affairs raising its 2026 growth forecast to 1.7% from 0.9% previously projected in June [1]. Additionally, second quarter 2026 GDP growth accelerated to 1.9% quarter-on-quarter (2.8% year-on-year), up from 0.6% quarter-on-quarter (0.5% year-on-year) in the first quarter of 2026 [1]. The SNB is expected to view recent rate hikes by the US Federal Reserve and the European Central Bank as providing a stronger counterweight to haven demand for the CHF [1].
CONCLUSION
The SNB is widely expected to keep its policy rate unchanged at 0% at the upcoming meeting, supported by improved economic growth and reduced haven demand for the Swiss franc. While a near-term inflation forecast upgrade is possible, the central bank's stance is likely to remain steady, with less emphasis on FX intervention. Market participants should anticipate continuity in SNB policy barring significant changes in underlying inflation dynamics.