🇨🇭 Cable FX Macro Weekly Note: Switzerland May Inflation Rate

**As seen in Risk In The Week report 06/02/23, subscribe at cablefxm.co.uk/reports

Swiss consumer prices eased to 2.6% Y/y from the prior 2.9%, the release came to miss the median forecast of 2.8%, April CPI accelerated by the slowest pace in a year. The month-over-month metric came in flat, monthly prices have not been this slow since December. April saw food prices decelerating by 0.9% M/m, while housing prices declined for the second consecutive month at -0.2%. Goods prices fell by 0.1% while services prices rebounded to 0.1% on the month. The May inflation release will be the last price data before the SNB’s quarterly policy meeting, on this, the desk at Commerzbank expects another rate hike from the central bank to lift the policy rate to 1.75%. Commerzbank points to inflation remaining above the SNB’s price target. Also, we remind you that recent ECB chatter has been tilted to the hawkish side of the scale, this reduces the incentive for the SNB to place a pause now as this would undermine the FX channel mechanism, which could add to further price pressures.