The Swiss National Bank said on Friday it would intervene in foreign currency markets where necessary to keep inflation on track after the United States added Switzerland to a list of countries being monitored for unfair currency and trade practices.
The SNB denied being a currency manipulator after the publication of the U.S. Treasury Report on Thursday, but said it would continue to act in Switzerland's interests as the strong franc helped push inflation into negative terrain last month.
"The SNB does not engage in any manipulation of the Swiss franc," it said. "It does not seek to prevent adjustments in the balance of trade or to gain unfair competitive advantages for the Swiss economy."
The SNB said it was in contact with U.S. authorities to explain Switzerland's economic situation and monetary policy, and would continue to use interest rates and forex market interventions if necessary to pursue its inflation target of 0-2%.
Swiss inflation hit a four-year low in May, with prices falling by 0.1%.
The SNB declined to say whether further talks with the United States were planned, but said its monetary policy was "geared towards the needs of Switzerland."
Switzerland met two of the U.S. Treasury's concerns regarding trade flows and its current account, but not on foreign currency interventions. SNB forex exchange purchases in 2024 were "minimal," Treasury said.
In 2024, the SNB bought only $1 billion in foreign currencies, equivalent to only 0.1% of Swiss GDP, well below the Treasury's threshold of 2% of economic output.
EFG Bank economist GianLuigi Mandruzzato said the SNB would be mindful of the Treasury report, but still pursue its mandate.
"My feeling is that there should be little reason for concern from a Swiss perspective," he said. "However, with the Trump administration, anything can happen."
