Swiss National Bank Slashes Interest Rates Amid Falling Inflation

The Swiss National Bank reduced interest rates by 25 basis points to combat lower inflation and emulate steps taken by the ECB and Federal Reserve. SNB Chairman Thomas Jordan's decision is his final move in his 12-year tenure and signals potential future cuts as inflation predictions fall sharply.

In a significant monetary policy move, the Swiss National Bank (SNB) reduced interest rates by 25 basis points on Thursday, aligning itself with recent actions taken by the European Central Bank and the U.S. Federal Reserve to lower borrowing costs.

This decision lowers the SNB's policy rate to 1.00%, marking the third reduction this year and the lowest level since early 2023. Analysts had anticipated this move amidst cooling inflation which slowed to 1.1% in August.

Chairman Thomas Jordan, in his final decision after a 12-year tenure, left the door open for further cuts, suggesting future reductions might be necessary to maintain price stability. This dovish stance is mirrored by the SNB's sharply revised inflation forecasts, signaling further easing may be required.

(With inputs from agencies.)