This is the SNB’s first rate hike in 15 years, and it did so by 50 basis points, raising the policy rate from -0.75% to -0.25%, defying predictions that the bank would keep monetary policy constant.
Furthermore, the SNB notes that additional hikes in the policy rate are not ruled out in order to keep inflation under control.
The Swiss Franc is surging across the board in reaction to the unexpected hike. And in the meantime, global bond yields have risen as even traditionally dovish central banks have taken a more proactive hawkish position. With the EUR/CHF back under 1.02, the path to parity is now clear.