Switzerland SNB Press Conference

The Swiss National Bank is in charge of determining interest rates in Switzerland. The policy rate of the SNB serves as the official interest rate. The Swiss National Bank (SNB) strives to keep the secured short-term Swiss franc money market rates as close as possible to the policy rate. SARON is the most reflective of these rates in the current market environment. On June 13, 2019, the Swiss National Bank's policy rate took the place of the target range for the three-month Swiss franc Libor (London Interbank Offered Rate), which had been employed in the SNB's monetary policy approach until that point. It was necessary to make this change because, as a result of the absence of underlying money market transactions, the Libor was becoming less relevant as the most important reference rate in financial markets. From September 6, 2011, until January 15, 2015, the SNB's minimum exchange rate of CHF 1.20 per euro, which was in effect during this time period, was the primary focus of implementation. On December 18, 2014, the SNB decided to impose a negative interest rate of -0.25% on the balances of sight deposit accounts. With the introduction of a negative interest rate, the Libor target range employed at the time was pushed into negative territory for the first time, and its width was increased to its regular width of 1% point. A reduction in the interest rate on sight deposits was implemented on January 15, 2015, and the goal range was lowered to between -1.25% and -0.25%, according to the Swiss National Bank (SNB). Because of the SNB's policy rate, negative interest has been in effect since January 22, 2015.