Interest rate forecast

Interest rate trends: a further rate rise by the Swiss National Bank

In June, bond markets will turn their attention to the upcoming central bank meetings. This applies to changes in interest rates on both government bonds and mortgage loans.

In mid-June, the U.S. Federal Reserve and the European Central Bank will discuss whether to continue raising interest rates. One week later – on 22 June – the governing board of the Swiss National Bank (SNB) meets to determine the Swiss key interest rate.

While headline inflation in Switzerland has fallen significantly, core inflation (excluding energy prices) remains stubbornly above the 2% mark. This will likely prompt the SNB to raise interest rates again by 0.25 percentage points to 1.75 percent, which we expect to be their peak rate. In the second half of the year, we expect SNB key interest rates to be stable, with a first interest rate cut in mid-2024.

The interest rate hike we forecast is already anticipated by the markets and should therefore have little impact on government bond yields and mortgage interest rates. In the longer term, we expect interest rates to fall slightly, if the focus of the markets shifts to the first key interest rate cuts. (Date 24 May 2023)

Long-term interest rate trend in %

Interest rate forecast in figures

Rates

Rates

25.05.23

25.05.23

30.06.23

30.06.23

31.12.23

31.12.23

30.06.24

30.06.24

31.12.24

31.12.24

Rates

SARON

25.05.23

1.45

30.06.23

1.75

31.12.23

1.75

30.06.24

1.50

31.12.24

1.44

Rates

Swap 3 years

25.05.23

1.86

30.06.23

1.84

31.12.23

1.66

30.06.24

1.32

31.12.24

1.28

Rates

Swap 5 years

25.05.23

1.86

30.06.23

1.85

31.12.23

1.74

30.06.24

1.42

31.12.24

1.38

Rates

Swap 10 years

25.05.23

1.96

30.06.23

1.94

31.12.23

1.77

30.06.24

1.56

31.12.24

1.54

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