Switzerland: Central Bank of the country may be able to raise rates

In a short time at the Swiss National Bank may be able to raise borrowing costs for the first time in nearly 4 years as the economy challenges the power of the franc. The Management Board will have to weigh two factors - almost zero rates, leading to an increase in property prices and increasing interest rates, which will inevitably lead to an increase in the franc. And although the franc gained nearly 20% against the euro since March 2009 (when the SNB lowered its rate to 0.25%), there are few signs that the current exchange rate of the franc undermines the recovery, with exports growing and leading indicators point to accelerating growth . "Did in fact the economy in near-zero interest rates", - said David Kohl, deputy chief economist at Julius Baer Group in Frankfurt. - "No, I do not need. Now is best time to raise rates, as any increase will affect the economy as a whole during the year." In his view, the restoration is strong enough to cope with increasing rates to 1% -1.5%. according to Jan Amrit Poser, chief economist at Bank Sarasin in Zurich, exports continue to grow despite the fact that the real effective exchange rate of the franc rose 10% last year. Although the rate of franc, the lowest among global central banks after the U.S. and Japan, stimulated economic recovery following the recession of 2009, it has also provoked a demand for real estate - in 2010, prices for single-family housing rose by 4.7%, with the largest growth was recorded in the region of Geneva - 12%. Source: K2Kapital