The Swiss National Bank (SNB) raised interest rates by 75 basis points (bp) to bring borrowing costs above zero for the first time in almost eight years, following recent moves in the eurozone.
The hike by officials led by Thomas Jordan takes Switzerland’s policy rate to 0.5 percent and is their most aggressive tightening action in two decades.
Policymakers said they cannot rule out further rate hikes and said they are willing to intervene in currency markets if needed.
The decision ends Europe’s decade-long experiment with negative borrowing costs. Globally, the only central bank left with sub-zero policy is now the Bank of Japan, which earlier yesterday held its benchmark at minus-0.1 percent.
The SNB hike is the second move by policymakers in Zurich to confront inflation in a year when about 90 counterparts have also raised rates. The SNB has now matched the European Central Bank’s 1.25 percentage point of tightening since July.
Separately, Norway’s central bank raised its benchmark interest rate by 50 basis points yesterday, and said it plans to hike again in November.
Norges Bank’s monetary policy committee raised the sight deposit rate to 2.25 percent from 1.75 percent, having signaled last month that a hike is likely this month.
“The policy rate will most likely be raised further in November,” the bank said in a statement.
The rate, now at the highest level since 2011, is set to increase to about 3 percent during the upcoming winter, the bank said, adding that projections were more “uncertain than normal.”
Meanwhile, the Philippine central bank raised its policy rate for a fifth time this year to quell inflation pressures amid a slumping currency and a hawkish US Federal Reserve.
Bangko Sentral ng Pilipinas yesterday raised the overnight reverse repurchase rate by 50 basis points to 4.25 percent.
Indonesia’s central bank also delivered a bigger-than-expected interest rate hike to stem inflation and stabilize the rupiah, marking an aggressive turn for policymakers who were monetary policy outliers until last month.
Bank Indonesia raised the seven-day reverse repurchase rate by 50 basis points, the biggest increment since 2018, to 4.25 percent.
Bank of Korea Governor Rhee Chang-yong yesterday widened the door for an outsized rate hike after another large move by the Fed pushed the Korean won below a key level.
“I will assess with the board members how the changes in these preconditions affect domestic inflation, growth trends and foreign exchange markets to determine the extent, timing and trajectory of rate hikes,” Rhee told reporters just after the currency weakened past 1,400 to the US dollar. “But no decision has been made.”
Additional reporting by Reuters
STEADY: Prices are to rebound following inventory rebuilding demand, TrendForce said, with Samsung Electronics Co further trimming capacity as it slashes DDR4 lines The contract prices of DRAM chips are to rise by as much as 18 percent sequentially this quarter — the first price upticks in about eight quarters — driven mainly by inventory rebuilding demand for DRAM chips used in mobile devices and PCs, TrendForce Corp (集邦科技) projected yesterday. The price rebound is led by a quarterly increase of mobile DRAM chips, which are to climb between 13 percent and 18 percent quarter-on-quarter this quarter, which has not been seen since the fourth quarter of 2021, the Taipei-based market researcher predicted. Likewise, the price of mainstream PC DDR4 DRAM is expected to bounce
SOLID FOUNDATION: Given its decades of expertise in megatronics, manufacturing and robotics, Japan has the wherewithal to create its own AI, Jensen Huang said Nvidia Corp plans to help build an artificial intelligence (AI) tech-related ecosystem in Japan to meet demand in a country eager to gain an edge in this emerging technology. The US company will seek to partner with Japanese research organizations, companies and start-ups to build factories for AI, Nvidia CEO Jensen Huang (黃仁勳) said yesterday during opening remarks in a meeting with Japanese Minister of Economy, Trade and Industry Yasutoshi Nishimura. The company is to set up an AI research laboratory, and invest in local start-ups and educate the public on using AI, Huang said. Huang earlier this week met with Japanese Prime
A Hong Kong court postponed a court hearing on troubled Chinese property developer Evergrande Group’s (恆大集團) winding-up petition scheduled for yesterday until Jan. 29. Evergrande is trying to win support from its creditors for a plan to restructure more than US$300 billion in debt to stave off liquidation. The company’s lawyer told the court it was requesting an adjournment to “refine” its new debt restructuring plan. The Hong Kong High Court has postponed the hearing over Evergrande’s potential liquidation several times. Judge Linda Chan (陳靜芬) had said in October that yesterday’s hearing would be the last before a decision is handed down. Chan
Huawei Technologies Co (華為) is among a field of “very formidable” competitors to Nvidia Corp in the race to produce the best artificial intelligence (AI) chips, Nvidia chief executive officer Jensen Huang (黃仁勳) said yesterday. Huawei, Intel Corp and an expanding group of semiconductor start-ups pose a stiff challenge to Nvidia’s dominant position in the market for AI accelerators, Huang told reporters in Singapore. Shenzhen-based Huawei has grown into China’s chip tech champion and returned to the spotlight this year with an advanced made-in-China smartphone processor. “We have a lot of competitors, in China and outside China,” Huang said. “Most of our competitors
RSS