Swiss economy faces its first recession in six years

Zurich

SWISS central bank president Thomas Jordan has little interest-rate firepower left as he watches over an economy teetering on the brink of its first recession in six years.

The Swiss National Bank, whose deposit rate is already at a record low of minus 0.75 per cent, is up against a slump in consumer prices and a shrinking economy after the central bank allowed the franc to float freely again six months ago. It can't cut rates much more without risking a run on cash and its limit is probably minus one per cent, according to Bloomberg's monthly survey of economists.