Andréa Maechler is the first woman in the directorate of the Swiss National Bank, the country's monetary authority. In her first-ever interview with a Swiss-German newspaper, Maechler defends the use of negative interest rates introduced in a bid to keep the franc from rising against the euro.
«We introduced negative rates to maintain the difference in interest rates to other countries and to reduce the upward pressure on the franc,» said Andréa Maechler in an interview with «Sonntagsblick» (article in German only). «Negative rates are an important and good instrument for that purpose,» the citizen of Geneva added.
Maechler however is less than convinced about the use of negative rates by other central banks. «Most countries aim to stimulate demand and credit-taking with negative rates. This is uncharted territory with many open questions,» the director at the SNB said.
Rates to Remain Low
Maechler was adamant that rates will remain low for a very long time. The financial markets expect further cuts in the U.K. and the eurozone. «As long as this is the case, the SNB hardly has room to raise rates,» she added.
The idea that the central bank might print extra money to distribute directly to citizens in a bid to stimulate growth – so-called «helicopter money» – isn't popular with the member of the directorate: «This is a no-go for the SNB.» The head of the third department at the SNB is responsible for interventions on the financial markets. She rebuked the allegation that the bank was not transparent in its investments.
No to Ethical Standards in Investments
«We are taking very seriously our role as an important investor,» Maechler said, adding that the bank didn't apply a specific set of ethically defined measures. «We are a central bank. We are not to apply measures within discussions of values. This isn't our role.»
The economist is happy about the condition of the economy in Switzerland. «The Swiss economy is doing better than might have been expected after Brexit.»
Cash Is Here to Stay
Maechler doesn't a reason to discuss the need to retain cash as tender, a discussion that has resurfaced frequently in the recent past. «You'll be stuck hiking in the mountains without cash. As long as this is the case, the question whether we should abandon cash won't even put itself to the SNB.»
Andréa Maechler grew up in Geneva. She studied macro economics in Toronto (CDN) and Geneva. Before joining the SNB, she worked for the International Monetary Fun (IMF) in Washington. The former Swiss swimming champion is married with two children.
