SNB surprise rate cut

The Swiss National Bank (c) Badwy

The Swiss National Bank surprised markets yesterday by cutting interest rates by a quarter of a percent to 1.5%.

Markets were expecting a hold decision. 

It makes the SNB the first major central bank to start cutting rates in this cycle. 

The bank says the fight against inflation has been effective. Inflation was just 1.2% last month. 

Policy makers have a target below 2% for inflation. At that level, prices are considered stable. 

The stock market rose on the news, while the franc fell on the currency markets.

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