"We are a small open economy. We do have an independent monetary policy, but as long as the interest rates are going to stay low around us...it's very unlikely that we'll be able to raise rates, whether they are still in a negative interest rate or above," she said.

Low Swiss inflation and fragile prospects for prices to keep rising helped SNB policymakers decide to keep negative rates on hold this month, she told an academic and business audience.

The SNB continued to intervene as needed on currency markets to counter excessive upward pressure on the franc, which remained strongly overvalued at around 10 percent above its long-term average, Maechler added.

Consumer prices rose 0.6 percent from a year ago in February and were 0.5 percent higher compared with the previous month. The SNB forecasts inflation of 0.3 percent in 2017, at the low end of its targeted range of between 0 and 2 percent.