Since the December meeting, financial market situation has been characterised by elevated volatilityMiddle East conflict has resulted in surge in energy prices, which led to a global rise in inflation expectations.

We can never exclude any measure on interest ratesWe have discussed many optionsNegative rates have side effectsWe set monetary policy, don’t have a goal for exchange rateHave not changed policy implementation with rates at 0% (Tschudin)Swiss banks can continue to operate at 0% rates (Martin)He’s trying to sound like they’re not that desperate yet to resort to negative rates.

This will be added to the SNB’s monetary policy repertoire moving forward but not before some test operations are conducted. For the time being, the central bank implements monetary policy by setting the SNB policy rate so this just adds to the tools they can play around with. However, I still see the key policy rate as being the main weapon in the armory.

Franc is currently sought after as a refuge currency. Franc appreciation also reflects inflation differential between Switzerland and other countries. The franc continues to be highly valued SNB looks at overall currency situationIndividual currency pairs do not play a special role. Some verbal intervention there by the SNB but in typical cases for the franc, actions speak louder than words.

The latest trial could see the introduction of central bank digital currency move a step closer in Switzerland. The SNB says that they integrated the digital currencies into payment systems and used them in simulated transactions involving UBS, Credit Suisse, Goldman Sachs, and Citigroup.