Why did the Swiss central bank introduce a negative interest rate in December 2014?

  • Wait, what? Yes, as of 22 Jan 2015 you will need to PAY an interest rate of 0.25% on balances above a certain amount.
  • This is an attempt to fight the huge upward pressure on the Swiss franc (as investors see it as a safe haven during the Russian crisis).
  • This negative interest rate makes it less attractive to hold Swiss francs investments, and hence tempers the upward pressure on the currency.

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