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Swiss inflation holds steady in July, keeping deflation fears in focus

July headline inflation slipped 0.1% month over month, while the SNB faces pressure from the stronger Swiss franc.

Reported · Written up by our desk · Central Banks

Swiss inflation in July remained relatively benign, with headline inflation showing a 0.1% decline on the month, according to Forexlive. The outlet said the July CPI print matched expectations for a +0.4% year over year result, after the prior month was +0.5%.

Forexlive also pointed to core inflation staying steady, with July core CPI at +0.3% year over year, versus the prior +0.3%. The report said core inflation continues to sit closer to 0% than 1%, leaving a key risk for Switzerland as a return to deflation.

With global price pressures still supportive, Forexlive said the SNB may not need immediate action. However, the outlet added that a stronger Swiss franc can keep weighing on the outlook, and that if currency strength persists, the central bank may be unable to avoid unconventional policy tools.

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