Swiss National Bank Maintains 0% Rate, Expresses Confidence in Inflation Outlook

ZURICH, October 23, 2025 — The Swiss National Bank (SNB) remains confident that inflation will stay within its 0–2% target range, according to the minutes of its most recent monetary policy meeting released on Thursday. The central bank reiterated that there was no need to adjust interest rates at this stage, even as it flagged potential risks from U.S. trade tariffs that could extend into the pharmaceutical sector.

The SNB held its benchmark interest rate at 0% during its September 25 meeting, noting that previous rate cuts were still working through the economy. The minutes mark the first time the SNB has published detailed records of its internal policy discussions, signaling a move toward greater transparency in monetary decision-making — a step already adopted by other major central banks such as the European Central Bank (ECB) and the U.S. Federal Reserve.

“The inflation forecast and the economic outlook support the case for not changing monetary policy,” the minutes stated, emphasizing that the current policy stance continues to support economic activity.

---

Inflation Under Control, Policy Seen as “Appropriately Expansionary”

The SNB said its expansionary monetary policy continues to underpin growth and financial stability, while inflation remains subdued. Despite slower economic momentum, officials see no immediate justification for loosening policy further.

UBS economist Maxime Botteron noted that in the SNB’s view, the current policy remains sufficiently expansionary to slightly lift inflation over the coming quarters — maintaining a delicate balance between economic support and price stability.

Gero Jung, chief investment strategist at Walliser Kantonalbank, echoed that sentiment, saying:

“In the absence of major shocks, it is highly likely that the current status quo of a 0% policy rate remains the most likely scenario.”

This cautious stance reflects the SNB’s long-standing reputation for prudence and stability, even as global central banks grapple with diverging inflation trends and shifting interest rate expectations.

---

U.S. Tariffs Pose Emerging Risk, SNB Warns

While the SNB’s tone remained calm on inflation, it highlighted growing concerns about U.S. tariffs on Swiss exports, especially if extended to pharmaceutical products, a key pillar of Switzerland’s export-driven economy.

In August 2025, the United States imposed 39% tariffs on select Swiss goods, though pharmaceuticals were initially exempted. The SNB warned that an expansion of these tariffs could negatively impact trade and manufacturing.

“At present, there are hardly any signs of the negative effects of the tariffs spreading from the export-oriented industries affected to other parts of the economy,” the SNB said.

Still, policymakers signaled close monitoring of the situation, acknowledging that a prolonged trade dispute could eventually dampen Swiss economic growth and pressure the franc.

---

SNB Embraces Transparency in Policy Communication

The publication of monetary policy minutes marks a notable shift in communication strategy for the SNB, traditionally among the world’s most discreet central banks. By providing greater insight into its decision-making process, the bank aims to enhance public understanding and market confidence in its policy framework.

The minutes reaffirmed that the SNB’s key priorities remain price stability, financial system resilience, and sustained growth, all while managing external shocks like tariffs and global interest rate fluctuations.

---

Key Takeaways

• SNB keeps interest rate steady at 0%, confident inflation will stay within its 0–2% target.
• Inflation outlook supports the current expansionary monetary stance.
• U.S. tariffs pose potential risks, particularly for the Swiss pharmaceutical sector.
• SNB unlikely to reintroduce negative rates barring major economic shocks.
• First publication of SNB minutes reflects a new era of transparency in Swiss monetary policy.