Bank of Japan Signals Cautious Path Toward Further Rate Hikes Amid Yen Weakness 
RBA Raises Interest Rates by 25 Basis Points as Inflation Pressures Persist 
China Extends Gold Buying Streak as Reserves Surge Despite Volatile Prices 
RBI Holds Repo Rate at 5.25% as India’s Growth Outlook Strengthens After U.S. Trade Deal 
South Africa Eyes ECB Repo Lines as Inflation Eases and Rate Cuts Loom 
Swiss growth has surprised economists and analysts (including us), who expected a contraction in growth, slowdown in exports, weakness in manufacturing activity.
Latest data points, all positive, baffling everyone as the economy shows significant strength. Even latest PMI report showed expansion in the manufacturing sectors.
However, while economy shows strength, what baffling Swiss National Bank (SNB) policymakers is that inflation trajectory, which is showing no sign of rebound.
Blame it on whatever you like, lower oil price, weakness in commodities, weak domestic demand, stronger Franc....one thing is certain SNB is creating an image that it is out of tools or at wits end to revert deflation and risks deflationary expectations to set in, if it hasn't already.
While Swiss GDP was able to expand by 0.2%, for three months to June but inflation dropped by another -0.2% in August, down -1.4% from a year ago.
Recently SNB has stepped efforts to weaken Franc and we expect it continue such efforts more aggressively over the coming months.
Swiss Franc is currently trading at 0.976 against Dollar.
