Swiss National Bank Chairman hints at rate rises to tackle inflation

ZURICH: The Swiss National Bank could raise interest rates to tackle inflation which remains above target, Chairman Thomas Jordan said in an interview published on Saturday,

Jordan defended the central bank’s commitment to price stability, which he defined as inflation below 2% but in positive territory, in the article in Swiss newspaper Corriere del Ticino.

“Most central banks have an inflation target of about 2%, the SNB is slightly more conservative,” Jordan said. “The 2% target is not a dogma, nor the will of a particular interest group.

“Of course if inflation is higher than the target, monetary policy must be restrictive,” Jordan told the newspaper.

Swiss annual inflation dipped to 2.2% in May, government data showed on Monday, but has remained above the 0-2% range targeted by the SNB since February 2022.

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Despite a recent easing in price rises in Switzerland, the SNB is expected by analysts and the market to raise interest rates at its meeting on June 22.

Earlier this week Jordan in a separate public appearance, said he could not rule out tightening monetary policy to tackle stubborn Swiss inflation.

In the newspaper interview Jordan said price stability created the best environment for economic growth, and was important for social stability and fairness.

“When inflation is above 2%, people with lower incomes especially suffer,” Jordan told the newspaper. “It is therefore a matter of social justice.”