On June 18, the SNB will decide on the key interest rate as part of its monetary policy assessment. The unresolved situation around the Strait of Hormuz and the global rise in inflation remain in focus for monetary policy. Yet a predominantly imported and likely temporary increase in inflation does not provide sufficient reason for the SNB to raise the key interest rate, which has been at 0.00% for some time. Therefore, we do not expect any change to the key interest rate on June 18.
Despite volatility, interest rates for fixed-rate mortgages are stable versus the prior month. Nevertheless, higher and more volatile fixed-rate mortgage rates, combined with ongoing geopolitical uncertainty, have raised concerns that the owner-occupied housing market could lose momentum. However, several data points – among them continued growth in outstanding mortgage volume – show that interest rate uncertainty has had less impact on demand and is primarily reflected in the choice of financing.
The current Mortgage Radar looks at the current situation and stresses the importance of a holistic analysis ahead of taking a buying decision.
Rafael Szucs, Head Key Clients & Corporates Burak Er, Head Research & Advisory Solutions
