Menu

Search

  |   Commentary

Menu

  |   Commentary

Search

Swiss economy likely to accelerate strongly in 2018

Following the sluggish performance in the first half of 2017, the Swiss economic growth accelerated noticeably in the third quarter, growing 0.6 percent sequentially. It was stronger than the average growth over the two previous quarters, and the quickest since the end of 2014, just before the Swiss National Bank raised its currency cap. This implies that hard data are finally beginning to catch up with the more positive business survey results seen since the beginning of the year.

Manufacturing sector mainly drove the third quarter growth, affirming the strong recovery clear in earlier quarters. The strong global economic upswing and the weaker franc have given stimulus to Swiss exports, aiding in sustaining the positive momentum in business investment, particularly in capital goods and machinery.

On the contrary to the first half of 2017, there are now signs that this solid export dynamic is beginning to benefit consumers. The jobless rate fell to 3.1 percent in October from 3.3 percent at the beginning of the year. Higher employment has put private consumption on a stronger footing. However, construction continued to be in a soft spot, with output declining for the third straight quarter.

Leading indicators imply that the upswing is still strongly on track. Business surveys reached new multi-year highs in November, indicating to sustained strength in exports and investment. Increasing capacity utilization in the industrial sector is also a positive signal for the outlook of investment, noted HSBC in a research report.

“In terms of annual GDP growth forecasts, we continue to expect a strong acceleration in 2018 (2.1 percent from 1.0 percent in 2017). In part, this reflects a boost in activity from the weaker franc that should continue to be felt well into 2018”, stated HSBC.

At 19:00 GMT the FxWirePro's Hourly Strength Index of Swiss Franc was neutral at 13.9954, while the FxWirePro's Hourly Strength Index of US Dollar was slightly bullish at 62.5354. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest

  • Market Data
Close

Welcome to EconoTimes

Sign up for daily updates for the most important
stories unfolding in the global economy.