Zurich, Switzerland (GenevaLunch) - The Swiss National Bank (SNB) early Thursday afternoon lowered its key interest rate range to 1.5-2.5%, effective immediately, saying it intends “to hold the rate in the middle of the target range for the time being.”

It said the lower rate will encourage economic activity without jeopardizing “a return to price stability” and that it will continue to “provide the Swiss franc money market with liquidity in a generous and flexible manner.”

It lowered the three-month Libor by 50 basis points. The Libor is the XX. The central bank warned of possible negative growth, noting that the “global economic outlook has deteriorated more severely than anticipated, which will impact growth in Switzerland in the next few quarters; growth in 2009 might even be negative. Moreover, the economic slowdown, the decline in the price of oil and the appreciation of the Swiss franc are reinforcing the expected drop in inflation.”

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