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SNB Introduces Stealth Negative Rate to Keep Money Markets Going

SNB Introduces Stealth Negative Rate to Keep Money Markets Going

Bloomberg19-06-2025
The Swiss National Bank may have cut its interest rate to zero, but the way it penalizes banks' excess reserve holdings means lenders will face negative rates if they park too much cash at the central bank.
Swiss banks can hold up to an unchanged 18 times their minimum reserve requirement in sight deposits at the SNB for free. For anything over that they will be charged interest of -0.25% as the discount from the policy rate remains unchanged at 25 basis points, the institution said in a statement on Thursday.
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