Central bank warns of inflationary pressures

The president of the Swiss National Bank, Jean-Pierre Roth, says he's concerned about inflation in Switzerland as a result of continuing high oil prices.

This content was published on May 28, 2008

He said the central bank remained "very vigilant" on the issue and would take it into account at its next interest rate assessment next month.

In an interview with the weekly Handelszeitung newspaper, Roth said inflationary pressures had heightened, adding this was a "surprise" for the bank.

Inflation in Switzerland fell to 2.3 per cent in April from a 14 ½ year high of 2.6 per cent in March. The annual inflation rate has been above the two per cent threshold that the bank equates with price stability since December.

"The oil price is climbing further and is causing a problem for all industrialised countries, because inflation is clearly accelerating everywhere. That is a new situation," he said.

Asked whether the bank would raise its key target interest rate from 2.75 per cent, Roth commented: "We will see. Today I can only say that we are keeping a close eye on inflation and will take suitable measures if they are necessary."

The bank had previously forecast inflation to fall below two per cent during the year.

In other remarks, Roth said he felt that the worst of the current financial crisis was over and economies in Europe were doing well.

But he called for stricter rules for international banks regarding their capital adequacy.

He also called on the Swiss Federal Banking Commission – the watchdog body of financial institutions - to take a tougher stance against the banks, saying they were now trying to minimise the damage.

In compliance with the JTI standards

In compliance with the JTI standards

More: SWI certified by the Journalism Trust Initiative

Contributions under this article have been turned off. You can find an overview of ongoing debates with our journalists here. Please join us!

If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at

Change your password

Do you really want to delete your profile?

Your subscription could not be saved. Please try again.
Almost finished... We need to confirm your email address. To complete the subscription process, please click the link in the email we just sent you.

Discover our weekly must-reads for free!

Sign up to get our top stories straight into your mailbox.

The SBC Privacy Policy provides additional information on how your data is processed.