National bank president to keep ‘very close eye’ on inflation

Thomas Jordan warned against dramatising the situation Keystone / Peter Klaunzer

The president of the Swiss National Bank (SNB), Thomas Jordan, says he takes the significant rise in inflation seriously and that one must “keep a very close eye on how it continues”.

Some of this inflation is “certainly temporary” and will decline again, Jordan said in an interviewExternal link with Swiss public radio, SRF, on Monday. But all central banks must also be careful “that it doesn’t become permanent”.

At the same time, he warned against dramatising the situation. In the short term, there are always major movements in the price level, he said. “The National Bank’s job is to ensure price stability in the medium and long term.”

Last year consumer prices in Switzerland increased by 0.6% on average, due in particular to higher prices for petroleum products and for housing rentals. In 2020 and 2019 average annual inflation was -0.7% and +0.4% respectively.

Jordan said he still considered it a good sign that the US Federal Reserve would probably raise interest rates soon. “This means the American economy is also back at capacity. It also means interest rates around the world are going up a bit and basically that’s positive news for us.”