In his address in Bern,  Martin Schlegel once again pointed to the current uncertain geopolitical and economic environment.

«Rising energy prices will push up inflation further in many countries in the coming months,» he said. «Global growth is likely to slow temporarily.»

This also affects Switzerland. «Growth may be somewhat subdued in the short term, although we expect a certain recovery in the medium term. In the coming quarters, higher energy prices will also lift inflation in Switzerland.»

Appreciation Pressure Has Increased

With regard to the strength of the Swiss franc against other currencies, he noted that prices in Switzerland have risen less sharply than abroad. «The real exchange rate takes this difference into account by adjusting the nominal exchange rate for price developments. As a result, the franc has, despite some fluctuations, changed little in real terms against the euro and the US dollar since 2020,» Schlegel said. Following the escalation in the Middle East, appreciation pressure has increased. A stronger franc dampens inflation, as imports become cheaper, but it also weighs on economic activity.

According to his assessment, rising energy prices will continue to push inflation higher in many countries in the coming months, while global growth is likely to slow temporarily. «The SNB cannot change the uncertain global environment. However, even under such conditions, we can successfully conduct monetary policy in the overall interest of the country. We are ready to adjust our monetary policy at any time if necessary, and we have the instruments to do so,» the SNB director emphasised.