This is how you benefit from falling interest rates: What falling inflation means for households in Switzerland

This is how you benefit from falling interest rates: What falling inflation means for households in Switzerland

According to a report by www.blick.ch, the Swiss will soon be able to benefit from falling interest rates due to declining inflation. UBS predicts that the Swiss National Bank (SNB) will cut interest rates as early as next June, with two further cuts to follow by the end of 2024. These forecasts have implications for various areas of the economy.

Falling interest rates could have a positive impact on the real estate market. With cheaper mortgage interest rates, buying houses and apartments will become more attractive again, which could lead to rising real estate prices. According to Moneypark's forecast, interest rates on mortgages are likely to fall significantly by the end of next year. This could also slow down price increases in the retail trade, as Swiss companies may not have to make further price increases for imported products from abroad due to the upward trend in the franc.

Furthermore, falling interest rates could also have a positive impact on employees' real salaries. UBS has lowered its inflation forecast for 2024, which means that many employees can hope for a small increase in real wages.

The latest forecasts also show that falling interest rates could counteract the ongoing increases in rental prices. However, the impact of this trend could be delayed as the reference interest rate reacts slowly to interest rate cuts.

Overall, the forecasts point to positive changes in various areas of the economy that could prove beneficial for households and consumption. However, the exact development depends on a variety of factors, including geopolitical developments, currency trends and international inflation rates.