Switzerland isn’t drifting back toward negative rates because growth is strong, it’s doing it because inflation has quietly disappeared and the franc keeps getting too strong. In periods of global stress, capital floods into Switzerland as a safe haven, tightening financial conditions without the SNB ever touching policy rates. That hurts exporters, suppresses prices, and raises the risk of outright deflation. The response isn’t loud QE or panic cuts; it’s more technical and defensive…tiered reserves, penalties on excess cash, and subtle pressure to keep money moving instead of sitting idle. None of this sparks a boom. It simply prevents conditions from tightening further when demand is already weak. Historically, it buys time and keeps the credit system from stalling.

Why the U.S. Eventually Walks the Same Road

The U.S. starts from a different place with inflation first, restraint second but the destination can still converge. As higher rates linger, debt rolls over at worse terms, delinquencies rise, commercial real estate strains, and growth cools. When inflation finally breaks, the policy problem flips. The choice stops being about fighting prices and becomes about preventing a credit contraction from morphing into deflation. That’s when zero rates, QE, or even something that looks like NIRP come back, not because central bankers want them, but because a highly levered, refinancing dependent system can’t absorb tight money indefinitely. Switzerland is the early signal. When safe haven flows, weak demand, and deflation risks dominate, central banks don’t double down on discipline, they ease constraints to keep the plumbing from freezing.