Switzerland Economic Forecast

Switzerland Economic Outlook

May 3, 2022

After slowing in Q4 on softer private consumption and export growth, the economic expansion likely continued at a moderate pace in Q1. While the lifting of virtually all Covid-19 restrictions from mid-February should have aided domestic demand, the Ukraine war raised price pressures, snarled up supply chains, and likely hurt sentiment towards the end of the quarter. Looking at available indicators, the manufacturing PMI averaged slightly lower in Q1 than in Q4 and the KOF Barometer declined through March. In contrast, the services PMI averaged higher in Q1 as the impact of the pandemic faded. Turning to Q2, the KOF Barometer rose in April, indicating a promising start to the quarter. In politics, in late April, Switzerland’s chief negotiator met with the European Commission in a bid to rekindle bilateral talks. However, no breakthrough was made, and relations with the EU remain at an impasse.

Switzerland Economic Growth

GDP growth will soften this year due to slower export growth and mild government consumption as pandemic-related spending demands ease. However, momentum should still be supported by a healthy labor market. Covid-19 variants, the Ukraine war and the gradual weakening of trade links with the EU in the absence of a revamped trade deal cloud the outlook. FocusEconomics Consensus Forecast panelists project the economy to expand 2.6% in 2022, which is down 0.1 percentage points from the previous month’s forecast, and 1.8% in 2023.

Switzerland Economy Data

2015 2016 2017 2018 2019
Population (million)8.28.38.48.58.5
GDP per capita (USD)82,47980,64180,77883,09782,311
GDP (USD bn)679671680705703
Economic Growth (GDP, annual variation in %)1.31.71.82.81.0
Domestic Demand (annual variation in %)2.20.81.80.80.0
Consumption (annual variation in %)1.71.41.21.01.2
Investment (annual variation in %)2.32.53.41.10.8
Exports (G&S, annual variation in %)2.66.3-0.22.90.5
Imports (G&S, annual variation in %)4.55.7-0.6-0.3-1.1
Industrial Production (annual variation in %)-2.00.15.25.44.4
Retail Sales (annual variation in %)-1.3-2.00.10.00.4
Unemployment Rate3.23.33.12.62.3
Fiscal Balance (% of GDP)0.60.31.2-  -  
Public Debt (% of GDP)30.028.929.3-  -  
Money (annual variation in %)1.43.94.03.50.1
Inflation Rate (CPI, annual variation in %, eop)-1.30.00.80.70.2
Inflation Rate (CPI, annual variation in %)-1.1-0.40.50.90.4
Inflation (PPI, annual variation in %)-3.7-1.30.01.3-0.8
Policy Interest Rate (%)-0.75-0.75-0.75-0.75-0.75
Stock Market (annual variation in %)-1.8-6.814.1-10.226.0
Exchange Rate (vs EUR)1.091.071.171.131.09
Exchange Rate (vs EUR, aop)1.071.091.111.161.11
Current Account (% of GDP)11.39.96.48.212.2
Current Account Balance (USD bn)77.066.243.357.686.1
Trade Balance (USD billion)36.832.829.731.236.1

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Switzerland Facts

Value Change Date
Bond Yield-0.516.27 %Jan 01
Exchange Rate0.97-0.54 %Jan 01

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