SARON Off Best Levels Post-SNB

Much of the post-SNB focus has centred on the previously flagged removal of the bias towards CHF strength in the post-meeting statement. Rates were left unchanged, as expected.

• Elsewhere, we note that the hiking bias has been removed, with the SNB flagging that “inflationary pressure has decreased slightly over the past quarter. However, uncertainty remains high. The SNB will therefore continue to monitor the development of inflation closely and will adjust its monetary policy if necessary to ensure inflation remains within the range consistent with price stability over the medium term.”
• The Bank’s inflation projections have been marked lower, now sitting below 2% during both ’24 and ’25.
• SARON futures soften a little post-decision, last running +10.0 to -2.5 on the day, with the reds outperforming.
• The feedthrough from last night’s Fed decision provided the bullish impetus for the strip in pre-SNB trade.