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SNB ‘Bombshell’ Could Open Pandora’s Box
If you had "SNB hike" on your bingo card this week, congratulations.
The Swiss National Bank hiked rates 50bps on Thursday, in a preemptive move to prevent inflation from spreading. It was the first hike in 15 years, and brought the policy rate to -0.25%. No economist projected a hike at Thursday's meeting, even as markets were alert to the possibility.
"There are now signs of inflation spreading to goods and services that are not directly affected by the war in Ukraine and the consequences of
That SNB is a mighty big hedge fund, that’s for sure…
SNB selling equities (index funds) at the current low would be an interesting way of destroying value
“One takeaway from the SNB’s decision is that the bank is now more concerned about fighting inflation than warding off currency strength..”
Well, they need to be. Prices here in the “high price island” are already so high that inflation would (does) hit doubly hard, especially for those on fixed income.
People who live in the border regions flock in their tens of thousands to buy groceries in France, Germany and Austria every weekend. Even with their higher inflation, the prices are mostly a bargain in the surrounding countries, inflation or not.