By Ed Frankl
Swiss annual inflation ticked down further in February, likely opening a clear path for the country's central bank to cut interest rates perhaps as early as this month.
The Swiss consumer price index increased by 1.2% on year in February, down from 1.3% in January, according to the country's statistics office. On a monthly rate, prices increased 0.6%.
Core annual inflation, which strips out more volatile fresh food and energy prices, was 1.1%, down a little from 1.2% in January.
Both rates of inflation are now well within the 0%-2% target range of the Swiss National Bank, having peaked at 3.5% in 2022, a level still well below the double-digit figures of the neighboring eurozone.
However, the recent period of disinflation is likely close to an end, according to Capital Economics economist Andrew Kenningham in a note.
Nevertheless, the SNB is still expected to cut its key interest rate, perhaps as soon as the upcoming meeting later in March. Its Chairman Thomas Jordan surprised markets on Friday by saying he would step down in September, although economists don't anticipate a change in monetary policy as a result.
"With inflation likely to remain close to 1% for the foreseeable future we think policymakers will start lowering interest rates later this month," Kenningham added.
Write to Ed Frankl at edward.frankl@wsj.com
(END) Dow Jones Newswires
03-04-24 0429ET
