- Swiss National Bank
Deflation threats continue to surround the Swiss economy, as the recent data showed consumer price inflation recorded a flat 0% change in October, compared with a timid increase of 0.1% in September. On an annual basis, CPI gauge remained at 0%, compared with the –0.1% contraction in September. Meanwhile, the Swiss Franc jumped to the highest level in two years versus the Euro, fuelling concerns of fresh monetary actions by the Swiss officials as the EUR/CHF pair is now approaching the central bank's floor rate. The Euro fell to 1.2033, the lowest since November 2012. In its September policy statement, the SNB said that it "will continue to enforce the minimum exchange rate with the utmost determination. For this purpose, it is prepared to purchase foreign currency in unlimited quantities. If necessary, it will take further measures immediately." Switzerland's economy continues to soften and the government has revised its growth outlook downwards for the second time this year. The State Secretariat for Economics slashed its GDP forecast for this year to 1.8%, down from the previous estimate of 2.0%, while 2015 growth projection was cut to 2.4% from 2.6%. The primary catalyst behind the government's revision of GDP forecast was the slowdown in the neighbouring Euro zone, as well as lack of business activity in Germany, Swiss largest export market, weighed on growth prospects of Swiss trade-led economy.
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