Karsten Junius

Chief Economist, Bank J. Safra Sarasin (Views expressed here are my own), #Europe, #ECB, #Germany, #Switzerland, #monetary policy, #financial markets, #IMF

[Karsten Junius @KarstenJunius]

The #SNB left its policy rate at 0% as expected. Most importantly, it didnt change the endpoint of its inflation #projection, indicating that policy is sufficiently #expansionary already to stimulate the economy and to deliver the desireed inflation rate in medium term.

[Karsten Junius @KarstenJunius]

#Swiss #inflation for November surprises on the #downside with -0.2% mom and 0.0% yoy as prices for services and goods - both imported and domestically produced fall on a broad basis. Still there is no need for the #SNB to cut its policy rate as wages and GDP should pick up 2026.

[Karsten Junius @KarstenJunius]

#Swiss #inflation remains at 0.2% yoy - slightly below expectations. Details are ok. Domestic inflation is stable at 0.6% yoy indicating that there are no deflationary processes. Imported inflation is negative but far above levels in 2015 and 2020. No reason for #negative #rates!

[Karsten Junius @KarstenJunius]

The #SNB reports CHF 5.06 bl #FX interventions for Q2 - the first quarter it purchased FX since 1Q22. Most likely it tried to smooth FX volatility after Trump announced reciprocal tariffs. Yesterday the SNB and the US treasury agreed to rule out competitive FX devaluations

[Zoe Schneeweiss @ZSchneeweiss]

French bonds get a lifeline with spread near a year-high on budget https://t.co/hKqqjy0rKO via @alicegledhill1 @WHorobin

[Karsten Junius @KarstenJunius]

#SNB keeps policy rate constant and signals no intention to cut rates further. The new inflation projection ends at 0.8% now, compared to 0.7% last quarter which signals that policy is sufficiently expansionary and a rate hike is more likely than a rate cut. We expect no changes.

[Karsten Junius @KarstenJunius]

#Minutes help to provide deeper insights into the economic #discussion and the evaluation of economic #arguments in a way that would not fit naturally in its Quarterly #Bulletin. They will contribute to a better understanding of the SNB's decision.

[Karsten Junius @KarstenJunius]

SNB President #Schlegel announced today that the #SNB will start publishing #minutes of its quarterly policy meetings 4 weeks after they took place. I welcome the decision as a step of the SNB to communicate more openly with financial #markets and the broader #public. (1/2)

[Karsten Junius @KarstenJunius]

#Swiss GDP grows only 0.1% qoq as investment spending, chemical and pharma exports decline. Interestingly also the trade balance of non-monetary gold declined. In Q1 it increased the trade surplus and displeased Trump, not sure though if he is lowering US tariffs on CH now...

[Karsten Junius @KarstenJunius]

39% #Zoll auf Importe aus der #Schweiz sind ein komplett absurdes Niveau für ein Land, das selbst keine Zölle auf Industriewaren erhebt. Ich kann mir nicht vorstellen, dass es dabei bleibt. Falls doch, rechne ich mit einem beschleunigten #Stellenabbau https://t.co/Kjhm7Pa2yP

[Karsten Junius @KarstenJunius]

Das Schweizer #KOF #Konjunkturbarometer verbessert sich im Juli deutlich. Interessanterweise treiben gerade das verarbeitende Gewerbe und das Gastgewerbe den Indikator, obwohl die #Auslandsnachfrage belastet haben soll.

[Karsten Junius @KarstenJunius]

#Swiss inflation increases by 0.2% mom and 0.1%yoy exactly as we expected. Core up to 0.6%yoy. Food prices made the biggest move with 3.0%mom the highest increase in June - way above the normal seaonal pattern - likely a result of the extremely hot weather. The SNB can relax

[Karsten Junius @KarstenJunius]

#SNB was clearly more dovish in its press conference than I expected. Yields are increasing over the whole yield curve & the Swiss #franc is appreciating. #Schlegel stressed that the intended message was that the hurdle for negative rates is very high due to its side effects.

[Karsten Junius @KarstenJunius]

The #SNB cut its policy rate by 25bp to 0%. Markets had priced 31bp. Yet,, I believe the SNB is right not to cut into negative territory yet as the medium term outlook for inflation hasnt changed much and the inflation profile remains clearly upward sloping.

[Karsten Junius @KarstenJunius]

#Consumer #inflation expectations as surveyed by the #ECB are picking up for the next 12 months and 3 years. Unclear whether that is trade war related or not. No reason to panic but also no reason to cut policy rates by 50bp next time. Several cuts by 25bp if needed are safer.

[Karsten Junius @KarstenJunius]

#SNB cuts policy rate by 25bp as expected. Importantly, it argues that the cut ensures that monetary policy remains #APPROPRIATE given low inflationary pressure. It also increased the inflation projection to 0.8% for Q3 &Q4 2027. Both indicate that no rate cut is likely in June.

[Karsten Junius @KarstenJunius]

25 Minutes until the #SNB decision. Only 17bp cut priced in right now - or a 69% probability of a 25bp cut. We still believe that they cut in order to anchor #inflation and inflation #expectations at a higher level

[Karsten Junius @KarstenJunius]

Goods news from Eurostat: Final February #inflation revised down to 2.3% from 2.4% and most importantly services inflation falls to 3.7%. In line with that also labour cost growth declined to 3.7% for 4Q24 from 4.5% in Q3. It really seems that we are on the right path

[Karsten Junius @KarstenJunius]

We expect the # SNB to cut its policy rate by 25bp on Thursday in order to anchor inflation expectations at a higher level and as higher long rates tighten financial conditions. Markets price a 73% probability for a cut.
More details in our preview:

https://t.co/DInJo1ZfIW

[Karsten Junius @KarstenJunius]

@Gerry83375022 -25bp

[Karsten Junius @KarstenJunius]

#Swiss inflation in Februar as expected. MoM increase of 0.6% for seasonal reasons only. The data shows that inflation is rather low and a rate cut is needed this month. This might be the last cut as there is no reason to panic: Risks of deflation or recession are low.