The Swiss National Bank is to leave interest rates unchanged on expectations that economic growth will slow in the coming year. The markets had been expecting a slight rise in the target rate.
Announcing his decision on Friday, the president of the central bank, Hans Meyer, said the three-month London Interbank Offered Rate (LIBOR) would remain the same at three to four per cent.
Meyer said that, despite the strength of the Swiss economy, inflation was well under control, and "there was no sign of price instability in sight".
Analysts say Meyer is banking on a slackening of economic growth next year. The central bank expects GDP expected to rise by 2.2 per cent in 2001, compared to 3.3 per cent this year.
That would push up inflation, currently at 1.6 per cent, to 2.1 per cent in 2001. But the bank believes it will then fall back below two per cent in 2002.
The bank's decision to freeze rates comes after the government changed its method of calculating inflation on the basis that rising energy costs - driven up by high oil prices - were distorting its sums.
The change led to inflation being revised downwards by as much as one per cent, reducing the pressure for an interest rate hike.
swissinfo with agencies