Switzerland’s central bank is willing to hike interest rates further to combat inflation, following the recent 75-basis point rise, said Governing Board member Andrea Maechler.

“It could be quite possible that we have to make further interest rate increases,” Maechler said. “We will have to see over time.

Last month, the Swiss National Bank (SNB) brought an end to its era of negative interest rates when it hiked its policy rate to 0.5%. The focus moved from attempting to curtail inflation to trying to halt the rise of the Swiss Franc, Reuters reports.

Inflation has returned to the country, despite being virtually absent for the last three decades, reaching 3.3% last month.

The Governing Board member added that the Swiss National Bank would monitor inflation forecasts, with the focus being on getting inflation back towards the 0-2% target.

The Swiss Franc’s strong value had helped to reduce the effect of imported price hikes, Maechler stated. However, the central bank is ready to make a currency intervention, she continued.

“Interest rates are in the positive, that is a good thing. That means that monetary policy will be more steered through interest rates; that means we are returning to conventional monetary policy.

“Still, the exchange rate will continue to play an important role for our monetary conditions. We have said we are ready to further intervene when the Franc is too strong and sell Swiss Francs,” Maechler went on to add.

“And if the Franc becomes significantly weaker we are ready to use our balance sheet, that means selling the foreign currencies we hold.”