FXStreet (Mumbai) - The Swiss National Bank left its benchmark interest rate unchanged at record-low levels of -0.75 per cent in line with expectations. The central bank also left the target range for the three-month Libor unchanged at between -1.25% and -0.25%. The SMB clearly stated it is prepared to slashing rates further into the negative territory with the objective to weaken the franc. With the implementation of negative rates the central bank wants to maintain the difference in EU and Swiss currency rates. The SNB feels “the Swiss franc is still significantly overvalued" though it has shown some depreciation in recent times. From the monetary policy statement it is evident that the SNB will "remain active in the foreign exchange market in order to influence the exchange rate situation, as necessary." The SNB had actually intervened to weaken the currency when it appreciated slightly post ECB’s announcement on 3rd December. Inflation forecast little changed The inflation forecast changed little from what was expected back in September. The SNB expects inflation to be slightly higher in the short term. However, the central bank has lowered medium term inflation forecast on account of poor global economic outlook. Inflation is forecast at –1.1% in 2015, a 0.1 percentage point rise on last quarter. For 2016, an inflation rate of –0.5% is expected. Inflation forecast has been moved up for 2017 to 0.3% from the earlier estimate of 0.4 per cent. The forecast is based on the assumption that the three-month Libor will remain unchanged at –0.75% over the forecast period. Growth forecast revised downward The SNB observed that global growth remained below expectation in the third quarter of the fiscal. The ultra lose monetary policy opted by the central banks helped to boost demand. Services sector thus performed well as compared to the manufacturing sector. The slowdown in emerging economies led by China hampered global trade. Structural weaknesses in Europe have also been causing disturbances affecting growth. Keeping the challenges in mind, the SNB revised its growth forecast for the global economy downwards for the short term The SNB estimates real growth of less than 1% in Switzerland. It believes the gradual improvement of the global economy will further strengthen foreign demand for Swiss goods and services. Domestic demand is expected to stay robust. Growth can be expected to increase 1.5% in 2016. The SNB said it will continue to monitor the mortgage and real estate markets closely and will regularly reassess the need for an adjustment of the countercyclical capital buffer. For more information, read our latest forex news.