Interest rate forecast

Interest rate trends: uncertainty and volatility on the bond markets

After a real roller coaster ride in March, the bond market calmed down in April. Interest rates for Swiss government bonds moved sideways for all major maturities. The same applies to mortgage interest rates.

However, it is uncertain how long this calm period will last. The bond markets are still waiting to see which direction the note-issuing banks will ultimately take. Will they continue to raise their key interest rates sharply to break stubborn core inflation? This suggests a higher interest rate level. Or are the note-issuing banks afraid of a banking crisis and a recession? This implies a lower interest rate level.

In recent quarters, the markets have fluctuated between these two scenarios, leading to high volatility on the bond markets. Until the note-issuing banks signal that key interest rate hikes are coming to an end, uncertainty and hence volatility on the interest rate markets are likely to persist.

Further interest rate increases by the Swiss National Bank are already expected by the capital market, which means that government bond yields and mortgage interest rates will probably move sideways or slightly downward in the coming quarters. However, due to the high level of uncertainty, we are still seeing this interest rate trend across a broad spectrum.

(Status as per 20 April 2023)

Long-term interest rate trend in %

Interest rate forecast in figures

Rates

Rates

04.05.23

04.05.23

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

04.05.23

1.42

30.06.23

1.75

31.12.23

1.75

30.06.24

1.76

31.12.24

1.68

Rates

Swap 3 years

04.05.23

1.74

30.06.23

1.94

31.12.23

1.83

30.06.24

1.72

31.12.24

1.63

Rates

Swap 5 years

04.05.23

1.76

30.06.23

1.98

31.12.23

1.87

30.06.24

1.77

31.12.24

1.70

Rates

Swap 10 years

04.05.23

1.88

30.06.23

2.08

31.12.23

1.98

30.06.24

1.90

31.12.24

1.86

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