Commerzbank’s Michael Pfister notes that reports of the Swiss National Bank (SNB) planning to keep rates unchanged until early 2028, if accurate, clash with still-ambitious market expectations for hikes by 2027. Combined with fresh US tariffs on Switzerland at a time when Swiss exports remain weak, this leaves the Swiss Franc under short-term pressure and delays prospects for a meaningful recovery.

SNB leak and US tariffs weigh

"Rather unusual news emerged yesterday: sources reportedly stated that the Swiss National Bank (SNB) is assuming internally that interest rates will remain unchanged until the end of 2027 and that a shift in interest rate policy will not be considered until early 2028."

"As we have argued on several occasions, the SNB would be ill-advised to hike the key interest rate this year."

"This means there is considerable potential for disappointment if the base rate of 0% is maintained until the end of next year, although it is likely to be some time before this potential materialises."

"As Swiss exports to the US have not yet recovered from last year's slump, this is putting pressure on the franc in the short term."

"For the time being, therefore, the franc continues to face difficulties."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)