The Swiss National Bank raised its policy interest rate for the first time in 15 years on Thursday, joining other central banks in tightening monetary policy to fight resurgent inflation and sending the safe-haven franc sharply higher.
MARKET REACTION: The Swiss franc soared almost 1.6% against the euro, to 1.0225 , and 1% against the dollar <0.9848 CHF=> after the surprise hike in the policy rate to -0.25% from the -0.75% level the SNB has deployed since 2015.
JAN VON GERICH, CHIEF ANALYST, NORDEA
"It's telling of the general environment that even the previous doves are now worried about inflation."
"The big picture remains that central banks are worried about being behind the curve and need to catch up."
GIUSEPPE SERSALE, STRATEGIST AT ANTHILIA IN MILAN.
"There a lot of nervousness. After the initial relief to the Fed ... markets seem to have woken up that it is still a 75 basis points rate hike. If then the Swiss central bank surprisingly raises by half a point clearly investors imagine that the tightening of central banks is still very violent. There is very little to be cheerful about."
CHRIS SCICLUNA, HEAD OF RESEARCH AT DAIWA CAPITAL MARKETS, LONDON:
"They did not repeat the description that (the Swiss franc) was highly valued, I guess the SNB is comfortable with that stronger currency right now in terms of it playing a role to push against imported price pressures.
"They signalled there are possibly further increases to come and it remains to be seen quite where neutral is for the Swiss and how far they want to push things."
LYN GRAHAM-TAYLOR, SENIOR RATES STRATEGIST, RABOBANK, LONDON
"It's clearly a big change in tack from their previous statement in March and clearly it was a significant surprise for economists.
"The SNB is also in a tight spot. This move fits with the narrative of central banks wanting to take action against inflation."
(Reporting by London Markets and Finance Teams; Editing by Catherine Evans)