Swiss National Bank Slashes Interest Rate to Zero Amid Economic Uncertainty

The Swiss National Bank took a significant decision on Thursday by cutting its interest rate to zero, addressing concerns over plummeting inflation and the appreciating Swiss franc. This decisive step comes amid growing economic uncertainty prompted by the unpredictable trade policies of the U.S. administration.

The central bank's reduction of its policy rate by 25 basis points from 0.25% was anticipated by market analysts and follows a series of rate cuts initiated in March 2024. The bank is once again approaching negative interest rates, a policy held from 2014 to 2022 but criticized by banks and savers.

Despite the Swiss franc briefly strengthening post-announcement, it leveled out against the dollar. The SNB anticipates weakened global growth in upcoming quarters. This move aligns with global trends, as other major central banks, including the Bank of England and Norway's central bank, prepare to make similar announcements.

(With inputs from agencies.)