Let’s say that it’s less certain than some months ago mainly because of the uncertainty w.r.t inflation abroad. Also to consider is the behaviour of CHF vs EUR which decreased recently and could add some inflationary pressure inland if that continues.
According to my basic analysis of the 1y swap rate and 3M bond yield there is 50% chance of a 25bps cut on next meeting.
Volatility on CH bonds and IRS is huge since a few weeks!
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UBS now sees it 50-50 for this week’s decision but still expects a decrease in SNB rate to 0.25 by end of June latest
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This thread has been helpful.
The remaining mortgage my wife and I have left is 60% of the value of our house. That 60%:
- 50% = 10 year fixed and half of that 50% is being amortized over 5 years
- 25% = SARON flex
- 25% = SARON flex
The first SARON flex, we want to keep as we like having flexibility to pay down mortgage early
The second SARON flex, we’re considering switching to 3-5 year fixed. SOmething i’ll look at end of March in case the rates drop as expected.
The markup we currently have on SARON is 0.7% which realistically is too high considering the low risk for UBS so that will also be part of the discussion.
depends on where you get the news from. Money markets give a 72% chance of a 0.25% rate reduction this week.