SNB Chief Says Swiss Industry Feels German Weakness

The current downturn in German industry is weakening demand in Switzerland's manufacturing sector, Swiss National Bank (SNB) Chairman Martin Schlegel said, as reported by John O’Donnell for Reuters.

In 2024, the SNB has reduced its benchmark interest rate three times, bringing it down to 1%, with further cuts anticipated. I Photo: Dominic Büttner Wikimedia Commons

Schlegel noted that Swiss manufacturers are experiencing significantly lower demand due to the economic struggles of Germany, Switzerland's largest trading partner. He made these remarks at an event in Frankfurt organized by Germany's Bundesbank, just under two weeks before the Swiss central bank's next interest rate decision.

In 2024, the SNB has reduced its benchmark interest rate three times, bringing it down to 1%, with further cuts anticipated.

Current market forecasts indicate a 72% probability of a 25-basis-point cut and a 28% likelihood of a 50-basis-point cut at the SNB’s upcoming monetary policy meeting on Dec. 12.

The rate reductions have been driven by slowing inflation, which has remained within the SNB's 0-2% target range for nearly 18 months.