Switzerland's Federal Statistical Office reported on the 3rd that the consumer price index (CPI) for August rose 0.8% year-on-year, doubling from July's 0.4% increase. The rate exceeded market expectations of 0.5%, primarily due to a 25% surge in oil prices. On a monthly basis, prices rose 0.4%. With Middle East conflicts pushing up fuel prices, expectations are growing that the Swiss National Bank (central bank) will bring forward its interest rate hikes. The central bank declined to comment on the latest inflation figures. Analysts note that the likelihood of a rate hike earlier than March next year has increased. Thomas Gitzel, an economist at VP Bank, said, "Although the inflation rate remains relatively low in absolute terms, so there is no immediate pressure on the central bank, price risks in Switzerland are also shifting upward," adding, "The possibility of a rate hike in December cannot be completely ruled out."
Swiss inflation doubles, fueling expectations of SNB rate hikes, which strengthens CHF against USD.
