Swiss Journal of Economics and Statistics

, Volume 146, Issue 1, pp 131–165 | Cite as

Swiss monetary policy 2000–2009

  • Hans Genberg
  • Stefan Gerlach
Open Access


In January 2000 the Swiss National Bank adopted a new monetary policy framework incorporating a price stability objective defined as (any rate of) CPI inflation below 2 percent. We contrast this framework with inflation targeting strategies and review the SNB’s policy decisions since its introduction. Empirical results indicate that in setting policy the SNB reacts in much the same way as inflation targeting central banks. The recent sharp reduction in the policy rate is consistent with the estimated reaction function until the second quarter of 2009 when the zero bound became binding, while the deterioration of economic conditions still called for further monetary easing. This may explain the unconventional monetary policy measures adopted since then.


inflation targeting SNB empirical reaction functions Taylor rule 


E43 E52 E58 


  1. Baltensperger, Ernst, Philipp Hildebrand, and Thomas Jordan (2007), “The Swiss National Bank’s Monetary Policy Concept— an Example of a ‘Principles-Based’ Policy Framework”, Swiss National Bank Economic Studies, 3, Zurich: Swiss National Bank.Google Scholar
  2. Bernanke, Ben, Thomas Laubach, Fredric Mishkin, and Adam Posen (1999), Inflation Targeting: Lessons from the International Experience, NJ: Princeton University Press.Google Scholar
  3. Camen, Ulrich, Hans Genberg and Michael Salemi (1990). “Optimal Monetary Policy and the Revealed Preference Function of the Swiss National Bank”, in: P. Artus and Y. Barroux (eds), Monetary Policy, A Theoretical and Econometric Approach, Dordrecht: Kluwer Academic Publishers, pp. 3–14.Google Scholar
  4. Gerlach, Stefan (2007), “Interest Rate Setting by the ECB, 1999–2006: Words and Deeds”, International Journal of Central Banking, 3, pp. 1–45.Google Scholar
  5. Judd, John P., and Glenn D. Rudebusch (1998), “Taylor’s Rule and the Fed: 1970–1997”, Federal Reserve Bank of San Francisco Economic Review, 3, pp. 3–16.Google Scholar
  6. Meyer, Hans (2000), «La politique monétaire à l’aube de la nouvelle année», Banque National Suisse Bulletin trimestriel, 1/2000, pp. 38–46.Google Scholar
  7. Miao, Yanliang (2009), “In Search of Successful Inflation Targeting: Evidence from an Inflation Targeting Index”, IMF Working Paper WP/09/148, Washington, D.C, International Monetary Fund, July.Google Scholar
  8. Mishkin, Fredric (2000), “Inflation Targeting in Emerging-Market Countries”, American Economic Review, Papers and Proceedings, 90(2), pp. 105–109.CrossRefGoogle Scholar
  9. Orphanides, Athanasios and Volker Wieland (2000), “Inflation Zone Targeting”, European Economic Review, 44, 7, pp. 1351–1387.CrossRefGoogle Scholar
  10. Roth, Jean-Pierre (2007), «Stratégie de politique monétaire, experiences récentes en Suisse», Séminaire de théorie et politique monétaires, Université de Fribourg, 28 novembre.Google Scholar
  11. Svensson, Lars E. O. (1997), “Inflation Forecast Targeting: Implementing and Monitoring Inflation Targets”, European Economic Review, 41, pp. 1111–1146.CrossRefGoogle Scholar
  12. Swiss National Bank, Quarterly Review, various issues.Google Scholar
  13. Taylor, John (1993), “Discretion versus Policy Rules in Practice”, Carnegie-Rochester Conference Series on Public Policy, 39, pp. 195–214.Google Scholar

Copyright information

© Swiss Society of Economics and Statistics 2010

Authors and Affiliations

  1. 1.BIS Asian OfficeCentralHong Kong
  2. 2.IMFSGoethe UniversityFrankfurt/MainGermany

Personalised recommendations