Petra Tschudin, a governing board member of the Swiss National Bank, cautioned that artificial intelligence could generate upward inflationary pressure in the short to medium term, even as the technology's broader economic impact remains uncertain.

Market Context

The comments from the SNB official come amid heightened scrutiny of AI's macroeconomic implications across major central banks. The International Monetary Fund's newly appointed chief economist Silvana Tenreyro simultaneously published research through Bank of England staff warning that productivity gains from artificial intelligence may not translate into lower inflation. Switzerland's central bank currently projects consumer prices will remain within its 0% to 2% annual target range through the first quarter of 2029, maintaining its policy rate at 0%.

Analysis

Tschudin told newspaper Finanz und Wirtschaft that the SNB is closely monitoring AI's price effects, acknowledging the technology could move inflation in either direction. She highlighted how investment flows are being redirected toward AI infrastructure, creating bottlenecks elsewhere in the economy. "Shortages can occur, for example with chips, causing prices to rise," Tschudin said. The governing board member emphasized that while longer-term productivity gains from artificial intelligence could theoretically lower prices by increasing efficiency, the annual calculation methodology for inflation requires sustained price declines to achieve a deflationary impact. "Productivity gains as such are not a new phenomenon. They do not, by themselves, lead an economy into structural deflation," she added.

Key Numbers

- Swiss National Bank policy interest rate: 0%

- SNB inflation target range: 0% to 2% annually

- Forecast horizon for price stability: through Q1 2029

- Current AI-related supply pressure cited: semiconductor chip shortages

What to Watch

Traders should monitor upcoming SNB policy communications for any shifts in the central bank's stance on technology-driven inflation risks. The conditional inflation forecast, which assumes unchanged interest rates, explicitly does not represent a commitment to hold rates steady for three years, Tschudin noted. "If there is new relevant information about inflation, we adjust monetary policy," she said. Markets should also track forthcoming IMF and Bank of England research on AI's macroeconomic transmission mechanisms as central banks globally attempt to model the technology's impact on price stability.