Business and Capital Market Analysis !!!

Thursday, the Swiss National Bank unexpectedly lowered the target range for the three-month Libor by 100 basis points to 0.5%-1.5%, with immediate effect. This is the second reduction in key interest rate in November.

The central bank noted that fall in raw material and oil prices would assist to restore price stability sooner than expected. Inflation would possibly fall below 2% as early as the end of this year, the SNB said.

On November 6, the SNB had cut the interest rate by 50 basis point to 2% from 2.5%, which was the second rate cut in a span of one month. The central bank was not scheduled to announce a rate decision until December.


Sources :

1. RTTNews : Swiss Central Bank Unexpectedly Cuts Interest Rate | 11/20/2008 7:34 AM ET.
2. Bloomberg : SNB Cuts Benchmark Rate by a Record 100 Basis Points (Update2) | November 20, 2008 07:58 EST.