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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Executive Summary:
- Bank seen raising rates by 50bps, reinstating the Eurozone-Swiss rate differential
- Sluggish return to inflation target seen persisting, justifying extra tightening
- Global banking turmoil should curtail impulse to hike 75bps, despite high CPI
Full preview, including summary of sell-side views here:
The Swiss National Bank enter this quarter’s policy meeting caught between burgeoning price pressures and increased fragility of the domestic financial sector. The pressured, and swift, tie-up of UBS and Credit Suisse has raised questions about the viability of Swiss banks, however the central bank should see financial instability as a tangential risk at this stage. This makes a 50bps rate hike the most likely outcome, maintaining the prevailing Eurozone-Swiss rate differential evident ahead of last week’s ECB decision.
The argument against the SNB tightening further on financial stability concerns will hinge on how successfully the bank will view their liquidity provision and brokering of the UBS - Credit Suisse tie-up as containing financial stability risks. While markets have undergone considerable volatility, signs of stabilisation since the weekend suggest the bank will be undeterred from their inflation-oriented approach this week.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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