By John Revill
ZURICH (Reuters) -The Swiss National Bank cut its policy interest rate by 25 basis points on Thursday, leaving borrowing costs just above zero as it weighs the impact of U.S. President Donald Trump’s trade policy on inflation and the global economy.
The SNB reduced its policy rate to 0.25% from 0.5%, its fifth successive cut since it started lowering borrowing costs in March 2024, matching economists’ expectations in a Reuters poll.
The decision comes on a busy day for central banks, with the Bank of England and Sweden’s central bank also due to announce their rates decisions on Thursday.
The U.S. Federal Reserve on Wednesday held its interest rates steady, citing a period of “unusually elevated” uncertainty linked to the initial policies of the Trump administration.
The new 0.25% rate is the lowest the SNB’s since September 2022, and leaves the central bank close to sub-zero interest again, a move it has previously not ruled out.
“With today’s rate adjustment, the SNB is ensuring that monetary conditions remain appropriate, given the low inflationary pressure and the heightened downside risks to inflation,” the SNB said.
The SNB cut rates to help prevent a further decline in Swiss inflation, which eased to 0.3% in February, its lowest level in nearly four years.
The cut is designed to prevent Swiss inflation from falling below the SNB’s 0-2% target range, which it defines as price stability, by lowering the value of the Swiss franc whose strength has reduced import prices.
(Reporting by John RevillEditing by Dave Graham and Tomasz Janowski)
