Report for the attention of the Governing Board of the Swiss National Bank for its quarterly monetary policy assessment of June 2025
The report describes economic and monetary developments in Switzerland and explains the inflation forecast. It shows how the SNB views the economic situation and the implications for monetary policy it draws from this assessment. The first section (‘Monetary policy decision of 19 June 2025’) is an excerpt from the press release published following the assessment.
This report is based on the data and information available as at 19 June 2025. Unless otherwise stated, all rates of change from the previous period are based on seasonally adjusted data and are annualised.
Key points
- On 19 June 2025, the SNB decided to lower its policy rate by 0.25 percentage points to 0%. In doing so, it countered the lower inflationary pressure compared with the previous quarter.
- The global economy continued to grow at a moderate pace in the first quarter of 2025. Nevertheless, due to the increase in trade tensions, global economic growth is likely to weaken in the quarters ahead.
- Economic growth in Switzerland was strong in the first quarter of 2025. However, this development was largely due to the fact that, as in other countries, exports to the US were brought forward. Growth is likely to be rather subdued for the remainder of the year due to the appreciation of the Swiss franc in recent months and weaker global demand. The SNB expects GDP growth of 1% to 1.5% for the year as a whole.
- There is currently high uncertainty about the economic outlook for the world and for Switzerland, particularly against the backdrop of trade policy developments.
- Inflation fell from 0.3% in February 2025 to – 0.1% in May, mainly due to the development of prices in tourism and for oil products. Inflation expectations were largely unchanged and within the range consistent with price stability.
- With the increase in trade tensions, the Swiss franc appreciated against the US dollar in particular. At the same time, yields on Confederation bonds and Swiss share prices declined significantly. Growth in residential real estate prices and mortgage lending was stronger than in the previous quarter. Growth in the broad monetary aggregates picked up pace.
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