Swiss Bond Yields Rise From 2-Month Low
The Swiss 10-year government bond yield rose above 0.45%, recovering from its lowest level in two months, tracking US Treasury yields higher as stronger-than-expected US inflation lifted expectations of another Fed rate hike. In Switzerland, however, SNB Chairman Schlegel said there were no signs of a broadening in price pressures and that the central bank had fulfilled its mandate of maintaining price stability over the medium term. Although inflation reached a three-year high in October amid a weaker franc and rising energy costs, energy accounts for only a small share of the Swiss CPI basket. A decline in oil prices amid expectations of a diplomatic resolution to the conflict in the Middle East has also offered some relief. The SNB is expected to leave rates unchanged at 0% at its meeting next month. While markets anticipate a hike in early 2027, economists expect the first increase only in late 2027.
The Swiss 10-year government bond yield rose above 0.45%, recovering from its lowest level in two months, tracking US Treasury yields higher as stronger-than-expected US inflation lifted expectations of another Fed rate hike. In Switzerland, however, SNB Chairman Schlegel said there were no signs of a broadening in price pressures and that the central bank had fulfilled its mandate of maintaining price stability over the medium term. Although inflation reached a three-year high in October amid a weaker franc and rising energy costs, energy accounts for only a small share of the Swiss CPI basket.
A decline in oil prices amid expectations of a diplomatic resolution to the conflict in the Middle East has also offered some relief. The SNB is expected to leave rates unchanged at 0% at its meeting next month. While markets anticipate a hike in early 2027, economists expect the first increase only in late 2027.