Swiss central bank chairman, Thomas Jordan, has returned from minor heart surgery to announce that interest rates will remain unchanged, despite increased inflation fears. The Swiss National Bank (SNB) said on Thursday it would keep interest rates in negative territory at -0.75% for the coming months. This policy is designed to stop the Swiss franc from gaining in value too much against other currencies. The SNB has raised its Swiss inflation forecasts slightly from its previous statement in June. If interest rates remain the same, the central bank now expects to see 0.5% inflation in Switzerland this year (0.4% was forecast in June) and 0.7% in 2002 (0.6% forecast in June). The upgraded inflation predictions are “primarily due to somewhat higher prices for oil products as well as for goods affected by supply bottlenecks,” the SNB stated. “In the longer term, the inflation forecast is virtually unchanged compared with June.” The Organisation for Economic Co-operation and...
