An Introduction To Banking & Finance (Foreign Expertise)

Inflation, the Economy and Interest Rates

Inflationary pressures observed worldwide in 2022 and 2023 appear to have eased as inflation rates in advanced and emerging economies have halved on average, whereas in Switzerland it now stands at 1.4%. However, as inflation rates are still above the targets set in most countries, central banks have consistently implemented monetary tightening regimes and raised policy interest rates over the past two years. While the Swiss national bank has cut interest rates as first mayor bank, both the FED and the ECB have signalled a slower than expected easing of their respective monetary policies in recognition of the persistent inflation rates above policy targets. The economic growth has accordingly remained slow.