The Swiss National Bank introduced a negative deposit rate yesterday, but its main tool to combat the threat of deflation is a ceiling for the Swiss franc. Given the continued threat of deflation and capital flows into safe havens, both Switzerland and the Czech Republic look set to continue with their currency ceilings for the foreseeable future. However, apart from Sweden, which may impose a ceiling on the krona next year, few other central banks are likely to go down this route.
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