MNI BRIEF: SNB On Hold, Ups Inflation Outlook On Bottlenecks

The Swiss National Bank kept its main policy rates unchanged at -0.75% Thursday, while noting the Swiss franc is still seen as “highly valued,” as highlighted in the latest MNI State of Play.

GDP growth is expected to be 3.5% for 2021 and 3.0% in 2022 -- a slight upward revision which the SNB attributed to higher import prices, especially for oil products and goods affected by global supply bottlenecks which are expected to ease over the medium term. The inflation outlook for 2021 is 0.6%, rising to 1.0% in 2022 before falling back to 0.6% in 2023.

“In its baseline scenario for the global economy, the SNB assumes that extensive containment measures will not have to be introduced again, this despite the adverse developments regarding the pandemic at present,” the SNB said in a statement. “The economic recovery should thus continue, albeit somewhat subdued.”