The Swiss are cutting interest rates. Why can’t we?

Mortgage rates will finally start to come down again. Consumers will have a little more money in their pockets. And companies will find it cheaper to invest. Today’s cut in interest rates was a much needed boost for the economy. Oh, but hold on. That was over in Switzerland, where the central bank this morning cut rates by 0.25 per cent. By contrast, the Bank of England has today kept them on hold.

This raises the question of whether the Swiss or British central banks have a better record of managing monetary policy. If most people in the markets had to put money on it they would probably place a franc or two on Switzerland. 

This may well prove to be just the beginning. The Swiss National Bank (SNB) today became the first of the major central banks to decide that the battle against inflation had now been won, and that the time had come to start reducing interest rates again.