New York Fed President John Williams Signals Rate Hold as Economy Seen Strong in 2026 
ECB Signals Steady Interest Rates as Fed Risks Loom Over Outlook 
Gold Prices Fall Amid Rate Jitters; Copper Steady as China Stimulus Eyed 
BOJ Policymakers Warn Weak Yen Could Fuel Inflation Risks and Delay Rate Action 
Bank of Korea Expected to Hold Interest Rates as Weak Won Limits Policy Easing 
Markets React as Tensions Rise Between White House and Federal Reserve Over Interest Rate Pressure 
RBA Raises Interest Rates by 25 Basis Points as Inflation Pressures Persist 
SNB, as widely expected, left policy rates unchanged at its March policy meeting. The statement released by the central bank and the new inflation projection do not signal that any further easing is imminent. SNB is also more cautious regarding the economic outlook and revised down the growth outlook to 1.0%-1.5% (+1.5% previously).
Despite inflation likely to undershoot the SNB’s target for a prolonged period, the SNB is unlikely to ease policy further. The updated inflation forecast for 2016 (-0.8%) and 2017 (+0.1%) show a small downward revision, mostly on the back of a lower expected path for oil prices. The SNB now expects inflation to become positive again only in Q3 2017, compared with Q1 2017 previously.
SNB still views CHF as “significantly overvalued" and will be ready to counter any upward pressure on the CHF, a lot of which is dependent on the ECB action and its implications for the CHF. However as ECB shifts away from policy rate cuts towards credit easing measures, there is a reduced likelihood that the SNB will need to intervene in the FX market or cut policy rates further.
“We continue to believe that, owing to the potential negative side effects, only renewed significant appreciation pressure on the CHF would make the SNB lower its policy rates further," notes Goldman Sachs in a research note.
