We could well be back to near zero again very soon. Though I think for most people a 0.5% margin is probably the cheapest they can hope for (without a special employee deal for bank employees).
SNB has reduced the interest rates by 25 bps to 1.0% today. After watching the press conference, it sounds to me that they will likely do another 25 bps cut in December, as hinted multiple times (given inflation will stay low and the Swiss Franc strong). 5Y Swaps seem to have dropped a bit intraday as well.
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The whole yield curve up to 6 years dropped almost 10bps today.
The 3 month 25bps and the 1 year 20bps.
Market definitely expecting another cut by 25bps in December.
I thought there was an outside chance theyâd go for 50bps today.
Good for Swiss stocks. As it would make bonds even less attractive.
In addition -: Direct Real estate funds are already marketing that 2% yield on direct real estate is much better than bond yields. Itâs funny how the comparison is made to bonds and not stocks 
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There was. I think itâs very likely that they will cut another 0.25% in December and then finally go down to 0.50% in summer 2025.
I agree with you!
UBS and Raiffeisen keep saying on their newsletter that the rates wonât be falling any further 
When I see a 1Y IRS at 0,65% and the 2Y at 0,53% according to me the SNB calendar the market is pricing today:
December 2024 0,75%
March 2025 0,5%
With a 1 mio SARON mortgage Iâm watching this much more than stock pricesđ€
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It was Jordanâs last day. Would be a bad message on last/first day of change of guards, even with 0.6% inflation must be a worry, but house not yet on fire to cut 50bp. The wording today pretty much guarantees a cut in Dec and likely again Marâ25, imho. Should see a strong âpriced-inâ rate moves in coming weeks.
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Yes, Iâm looking to switch from SARON to a long term fix if the rates are good!
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How good is good enough?
Do you all see a probability for a 2nd, 3rd inflation wave in the next few years due to the massive MMT globally and price this in to answer above question?
As per UBS article, they expect SARON to be favorable versus fixed term mortgages for longer term horizons. So it looks like fixed rate is like an insurance/ hedge and comes with a cost.
But somehow I think that while taking mortgages it could be beneficial to have some sort of fixed costs to help proper planning of cash flows.
A probability? Sure. Iâm not so convinced weâre going there, though, seeing the money funnelled in the stock market. My guess is that it can absorb excess liquidity that then wouldnât get converted in extra expenses.
I donât foresee an important future wave of inflation but these things tend to come unexpectedly so I wouldnât bet my wealth on that.
I already see a 0.7% extra VAT increase in 2026 to finance the 13th month AHV.
As of today, the SNB only expects a 0.7% inflation rate in 2026⊠probably a bit too low?
In the long term, yes. Though in the short term, I think recession and possibly China exporting deflation might more than balance it out.
Iâm asking myself.
Fun story: My negotiated 10-year rate moved between 0.7 and 0.8% few years ago. Took my time, well, why would it move anywhere, if not down? Few months later, the rate was 3x as high. Took most analysts, economist, banks, whatever by suprise. Maybe even some members of this forum.
Bad timing, missed opportunity. Or rather, costly mistake. 
1.5% isnât that bad, could be less then 1% net, if you arenât anchored on those past rates below 1% 
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I guess thatâs the trade off. On the one hand you expect to pay more in the long run. But on the other, maybe this allows you to be more aggressive in your asset allocation, which in turn will improve expected returns.
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Hi all, Seems I just found this forum too late, I just fixed my mortgage to 1.35 for 6 years 1.5 months ago which was an employee rate at a bank (now it is 1.15%)
Absolutely. Even if you get fired, you can switch quickly to another bank.
Yep obviously the internal customer advisors said nothing, not even a hint, I got into my mortgage when rates flew to 2.2 originally so I was very scared something like this will happen again and thought this rate is low enough, clearly I couldnât have made a bigger mistake. Now seeing Saron rates go down I guess I have to live with this burden for 6 yrs. I calculated potential loss on this term if Saron drops to 0.5% and we have 0.45% margin it will be around 16kâŠ
I think you are looking at this a wrong way.
Your rate would be fixed no matter what ⊠if SNB increases rates by 5% tomorrow. Your rate will still be fixed
Thatâs the hedge you made. This is why when it comes to fixed rates, borrowers shouldnât hope to win against the market, they should simply fix what they are happy with.
I often see hedging being assumed as winning strategy. But itâs more about certainty.
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