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But it would have dire consequences, both raising inflation and dissipating vitally important incentives for reform".
Because in raising inflation, the SNB would have reduced Switzerland's competitiveness (all else equal) not sharpened it.
But the principal effect of cutting interest rates is to boost domestic demand, which would risk raising inflation.
"As a result, asset prices, money and credit growth could all rise, raising inflation risks in 2011.
Prices of imports rise when expressed in dollars, raising inflation and the prospect of higher interest rates.
Some Bank policymakers have expressed concern about wage growth picking up and, in time, raising inflation in the wider economy.
Similar(27)
It will raise inflation.
"Such shocks push up unemployment and raise inflation.
But they also raise inflation, which calls for tightening.
Large budget deficits also directly raise inflation expectations.
If the central bank were to raise inflation expectations that would provide the necessary monetary traction.
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