The Swiss National Bank (SNB) is expected to keep interest rates unchanged at 0.0%. The focus will be on central bank’s signals about potential intervention in the currency market after EUR/CHF fell to 0.90 recently amid the US-Iran conflict.

The central bank has repeatedly said that the bar for a return to negative interest rates is very high even though inflation in Switzerland has been hovering near 0% for months. SNB’s Chairman Schlegel even added that a few months of deflation would still not be enough for them to cut rates further.

Higher energy prices will likely push headline inflation up in the next months although there’s also the risk of slowing economic activity, especially amid the Franc’s strength.

In fact, the focus will likely be more on the Swiss Franc. The SNB has already hinted at an increased readiness to act, but tomorrow provides the first official platform to signal an action.

The market is not pricing any change to interest rates this year, but it did raise the probabilities of a rate hike by year-end to 44%. That’s very unlikely to happen though as the SNB will focus more on downside risks to the economy and look through the energy price hikes.