The Swiss 10-year government bond yield eased to around 0.28%, retreating from recent one-month highs, as investors repositioned ahead of key US CPI data that could shed new light on the Federal Reserve’s policy outlook. Domestically, the latest inflation figures reinforced expectations that the Swiss National Bank will maintain an accommodative stance for the foreseeable future.
Swiss consumer prices rose 0.1% year-on-year in January, unchanged from December and at the lower bound of the SNB’s 0%–2% price-stability range. SNB President Martin Schlegel recently noted that the central bank is prepared to tolerate brief periods of negative inflation, while remaining focused on its medium-term objectives. At the same time, persistent safe-haven demand continued to lend support to Swiss government bonds.
