Swiss October consumer prices see third month of M/M declines

By Ludwig Burger

FRANKFURT, Nov 3 (Reuters) - Swiss consumer prices saw a month-on-month decline for a third consecutive time in October, intensifying scrutiny of the country's central bank over the potential introduction of negative interest rates to stave off deflation.

Among the goods and services that were marked-down the most were hotel stays, package holidays abroad and rental vehicles, the Swiss Federal Statistical Office said in a statement on Monday.

Consumer prices slipped 0.3% month-on-month in October, after declines of 0.2% and 0.1% during the previous two months, while the year-on-year gain in prices in October was 0.1%, barely in inflationary territory.

Swiss National Bank governing board member Petra Tschudin said last week the central bank could live with inflation in the country falling below 0% for a short time, but she reiterated that interest rates below zero could become necessary to combat persistently low inflation.

The SNB aims for annual inflation of between 0-2%. Negative rates sparked concerns from savers and pension funds when used by the SNB from December 2014 to September 2022. The Swiss franc fell against the euro on the news, with currency traders seeing a boost for doves at the SNB advocating sub-zero policy rate.

The statistics office's statement added, however, that a consumer price index harmonized to be consistent with the European Union's inflation gauge was unchanged from the previous month.

(Reporting by Ludwig Burger, Editing by Friederike Heine)