Economics
The Case for a Swiss Rate Cut May Be Stronger Than You Think
- Bond market move provided a signal for 2015 rate cut
- SNB deposit rate has been at -0.75% since January 2015
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The last time the Swiss National Bank surprised investors by cutting interest rates, the bond market provided a signal. It’s now flashing again.
The spread between yields on Swiss and German bonds evaporated last week, just as they did when the SNB slashed its deposit rate to to -0.75% and gave up its cap of 1.20 per euro on the franc in early 2015.