Davos: ECB's Schlegel on the Impact of Geopolitics on Inflation

Summary

Martin Schlegel, President of the Swiss National Bank, speaks with Bloomberg's Francine Lacqua at Davos about Swiss inflation, monetary policy, and the Swiss franc. He says inflation is 0.1%, expects it to rise over the medium term, and sees the 0% policy rate as appropriate, with negative rates requiring a high bar. Geopolitical risk is the main concern, and the SNB is ready to intervene in FX markets if needed. He also stresses central bank independence and the Fed's importance for global financial stability.

• SNB policy rate kept at 0%; current monetary conditions deemed appropriate.
• Swiss inflation at 0.1%, expected to rise this year and next; negative monthly prints possible.
• Negative rates seen as high-bar tool due to different transmission.
• Geopolitical risks are the biggest concern and can affect Swiss inflation and the franc.
• Swiss franc described as a safe haven; SNB ready to intervene in FX markets if necessary.
• Schlegel emphasizes central bank independence and the Fed's role in global stability.
• He declines to comment on Switzerland's population-cap vote, citing political neutrality.