by George Dorgan
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Jordan in the ECO interview - Click to enlarge
In its monetary assessment the SNB maintains the EUR/CHF floor and warned against further risks in the euro zone. The SNB has downgraded the inflation path to -0.2% (previously-0.1%) in 2013 and +0.2% (previously +0.4%) in 2014, while Swiss Statistics speaks of +0.1% for 2013 in its newest projection.
We see that oil prices are weaker than one year ago. This is for us a temporary influence that should finish by May/June. Furthermore we expect import prices from the main trading partner Germany to move higher again due to rising salaries. This would counter some longer lasting downwards pressure. Last but least, a weaker franc would accelerate inflation. Therefore we do not agree with the SNB inflation expectations for 2013 and match rather with Swiss Statistics. For 2014 we expect 0.5% higher inflation and a further shrinking of the gap with the whole euro zone.
Tags: Interest Rate,Libor,Monetary Policy,Swiss National Bank
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