Swiss National Bank keeps its key rate at 0%

The Swiss National Bank rates 0% decision leaves Switzerland apart from several major central banks that have begun tightening policy. The SNB kept its key rate at 0% on Thursday, September 24, as annual inflation stood at 0.8% in August, within its stated 0% to 2% price-stability range, CNBC reported.

For investors, the decision highlights how inflation and currency moves can produce different rate paths across countries. The European Central Bank, U.S. Federal Reserve and Bank of Japan have started raising rates, according to CNBC, while Swiss policymakers see a different domestic inflation picture.

Why did the Swiss National Bank keep rates at 0%?

The SNB’s inflation objective differs from the 2% targets used by many peers: it seeks to keep inflation between 0% and 2%. August’s 0.8% reading was lifted by higher gasoline, diesel and heating-oil costs, CNBC reported, but it remained inside that range.

SNB Chairman Martin Schlegel told CNBC that the central bank had held rates steady because of the inflation outlook and that a 0% rate was appropriate “at the moment.” Policymakers expect inflation to rise somewhat in the fourth quarter before easing during 2027, according to the report.

The forecast cited by CNBC puts average annual inflation at 0.7% in 2026, then 0.8% in both 2027 and 2028. Those projections are a forecast, rather than a commitment that rates will stay unchanged over that period.

How does the Swiss franc affect inflation?

Switzerland’s currency is central to the calculation. A stronger Swiss franc makes imported goods cheaper in franc terms, which can restrain imported inflation. CNBC reported that this has helped shield the country from some of the price pressure experienced by its trading partners.

That mechanism can also work in the other direction. The franc climbed more than 12% against the U.S. dollar in 2025, CNBC said, but the dollar had recovered about 4% against the franc so far in 2026. A weaker franc can make imports more expensive and add to inflation concerns.

Schlegel said uncertainty remained high and that the SNB was still willing to intervene in foreign-exchange markets if necessary. He said policymakers consider overseas developments because Switzerland is a small, open economy, while emphasizing that the bank sets monetary policy for Switzerland.

What are markets expecting from the SNB?

Markets are not treating the September hold as a promise of zero rates indefinitely. Traders saw roughly even odds of a December increase or another hold, CNBC reported. They also priced more than a 90% chance that the SNB would begin raising rates by early 2027.

LSEG data cited by CNBC showed traders expecting the policy rate to reach at least 0.75% by September 2027. That is market pricing, not an SNB forecast.

UBS economists said recent franc depreciation, elevated oil prices and resilient U.S. and euro-zone economies had increased the chance of an earlier hike than they previously expected, CNBC reported. The bank’s decision for now remains unchanged: rates are at zero, with energy costs and the currency among the pressures policymakers are watching.

This story draws on original reporting from CNBC.