The Swiss National Bank (BNS) has lowered its interest rate from 0.25 to 0%, making it effective from June 20. The goal of this move is to counteract the lower inflationary pressure.
Switzerland and the new policy of the National Bank: the interest rate drops to 0%
The Banca Nazionale Svizzera (BNS) has decided to implement a new monetary policy: lowering its interest rate to 0%.
The previous policy rate of the BNS was 0.25 percentage points, but starting from June 20, 2025, this rate will therefore be zeroed.
The main objective of this move is to counter the lower inflationary pressure, as it has decreased compared to the previous quarter.
Specifically, in fact, the BNS reveals that inflation has gone from 0.3% in February to -0.1% in May. This decline was mainly attributed to the trend in tourism prices and petroleum products.
It is a policy that ensures that inflation remains within the range compatible with price stability in the medium term.
In annual terms, the bank states that the average inflation stands at 0.2% for 2025, 0.5% for 2026, and 0.7% for 2027. This forecast is based on the assumption that the interest rate of the Swiss National Bank remains at 0% throughout the entire period.
Switzerland and the 0% Rates of the SNB: Cheaper Loans but Challenges for Savers
At the national level, the consequences of the new monetary policy of the Swiss National Bank are mixed.
In fact, by lowering its interest rate to 0%, the BNS makes borrowing cheaper and encourages investments. Not only that, the Swiss franc remains weakened, helping Swiss exporters.
On the other hand, however, to notice such a move as a challenge will instead be the savers, due to negligible returns, and the banks, which instead face compromised lending margins.
For investors, low interest rates have often increased the demand for riskier assets, including stocks. In this scenario, crypto markets often see growing interest as investors seek yield.
The crypto company of Andrew Peel and the blockchain manifesto
Last month, Switzerland was at the center of some crypto news. Among others, it seems that Andrew Peel, former head of digital asset markets at Morgan Stanley, decided to found his own crypto company in Switzerland, leaving the Wall Street giant.
The new Peel company will be based in Zug, the Swiss “crypto valley.” Not only that, the company is expected to be a hybrid between asset management and technology services, with a focus on tokenized DeFi assets, such as blockchain-based investment funds.
Another crypto news concerns the Swiss Blockchain Federation, the Crypto Valley Association, and the Bitcoin Association Switzerland that have jointly published a manifesto on blockchain and financial innovation.
In practice, the document has been structured into a 12-point program, and aims to consolidate and strengthen Switzerland’s role as a global financial hub.