* 37 of 38 analysts see SNB holding LIBOR target at 0.25 pct
* Only minority sees SNB resuming currency interventions
* SNB seen raising GDP f'cst, but lower 2012 inflation f'cst
By Sven Egenter
ZURICH, Sept 9 (Reuters) - The Swiss National Bank is widely expected to keep its interest rate target at ultra-low levels at its policy meeting next week, despite the strength of the economy, as the soaring Swiss franc poses a risk to economic recovery. Despite the franc's rally, only 8 out of 27 analysts expect the central bank to resume its interventions, which it dropped at its June meeting, saying deflation risks it fought by selling franc had largely disappeared.
In a Reuters poll conducted between Sept 7 and 9, 37 of the 38 economists saw the SNB keeping its 3-month LIBOR target at 0.25 percent on Sept 16.
"The de facto tightening in policy caused by the persisting franc strength will put back an early rate hike by the SNB to 2011 even as the forecast of 2010 GDP is revised up from June," Lloyds Banking Group analyst Kenneth Broux said.
Only UBS' analysts stuck to their long-held view that the SNB would raise its target to 0.5 percent as the economy was powering ahead.
The Reuters poll showed the median forecast was for a first hike at the SNB's meeting in March 2011. Interest rate futures are currently pricing in a full hike only by June 2011.
STRONGER GROWTH
The SNB board led by Chairman Philipp Hildebrand will publish its rate decision as well as inflation and growth forecasts at 1200 GMT next Thursday, followed by a statement.
In a recent interview, Hildebrand said risks to the economy had increased since the June meeting.
The Swiss economy has weathered the crisis better than many of its European neighbours thanks to the resilience of its consumers. Recent data have confirmed a strong recovery, now increasingly driven by companies' investment.
The poll showed that economists expect the SNB to raise its 2010 growth forecast to around 2.5 percent from the around 2 percent it predicted in June.
The KOF research institute's consensus poll among Swiss economists also showed a more optimistic view on the economy.
The 22 economists polled now saw growth at 2.3 percent this year slowing to 1.7 percent in 2011.
However, in the Reuters poll, analysts expect the SNB to lower its key 2012 inflation forecast to 2 percent from 2.2 percent forecast in June as the strong franc lowered price pressures and surveys showed slower economic growth ahead.
The SNB aims to keep inflation below 2 percent over the medium-term.
Swiss consumer price inflation has eased back to 0.3 percent in August and core inflation, which strips out volatile prices for food and energy, is at just 0.1 percent.
With inflation close to zero, the recent surge of the Swiss franc to fresh record highs against the euro around 1.28 francs per euro has sparked speculation that the central bank may resume interventions to fend off deflation risks.
"Levels below 1.30 franc per euro are becoming really painful for Swiss exporters, particularly if worldwide demand growth does slow down as it seems to be happening now," said Timo Klein, analyst at IHS Global Insight.
However, most economists don't expect the central bank to sell francs against euro again.
"The SNB decided in June to leave the franc alone and against the firmer macro backdrop I would expect the SNB to stay sidelined," Lloyds TSB analyst Broux said.
"Only a relapse in activity in the US and in Europe may lead the SNB to reconsider but only in a context of growing dis-inflationary pressures. This is not the case today."
(Reporting by Sven Egenter, Polling by Bangalore Polling unit; Editing by Toby Chopra)