Swiss inflation rose to its strongest level in more than two years last month, as imported energy prices accelerated on intensifying tensions in the Middle East.

Annual inflation was 1.0% in September, compared with 0.8% in the prior month, reaching the highest point since August 2024, Switzerland's statistics office said Thursday.

As in the neighboring eurozone, inflation climbed last month on the back of increased military action in the Middle East that has sent oil and gas prices surging.

However, core inflation only edged up to 0.5%, from 0.4% in August, suggesting limited signs of those energy prices bleeding into other parts of the economy.

The Swiss National Bank last week held its key rate at 0%, noting that energy prices had dragged inflation higher from close to zero at the start of the year, but that medium-term inflationary pressure had increased only slightly.

Inflation is now at the mid-point of the SNB's 0%-2% target range, suggesting it will be in no rush to raise rates soon. However, investors expect as many as three interest-rate hikes before the end of 2027, LSEG data shows.

"Today's data will reinforce the SNB's message, and market expectations, that the bank will stay on hold in the fourth quarter," Pantheon Macroeconomics economist Claus Vistesen said in a note to clients.

Energy inflation is spreading only slowly to core prices and has yet to push headline inflation to an uncomfortable level for the central bank, he added.