12.12.24 - SNB surprises markets

Swiss National Bank (SNB) cuts key interest rate by 50bps, analysts consensus expected 25bps.

Markets: Swiss franc (CHF) weakens against major peers. Swiss equity indices see a smaller gains after the announcement.

My view: Even SNB surprises with the bigger than expected rate cut, I see the market impact rather short-lived. The currently priced-in expectations of negative interest rates in 2025 seem exaggerated. Therefore Swiss equities might continue to lag as other regions remain more in focus. Currency wise, the Swiss Franc will not lose much more ground from here as other central banks remain in the rate cut cycle too, as ECB at noon today.

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