Switzerland: Consumer sentiment jumps to seven-year high in Q1
Consumer sentiment among Swiss households improved markedly in the November–January period, with the index climbing from minus 2 points to plus 5 points—coming in above market analysts’ expectations of plus 2 points and posting the highest level in seven years. The consumer sentiment index, prepared in January by the State Secretariat for Economic Affairs (SECO), stands significantly above the long-run average of minus 9 points and now sits above the 0-point threshold separating optimism from pessimism among consumers.
The pick-up in Q1 was driven largely by consumers’ considerably more optimistic view regarding future economic conditions and the labor market situation. Consumers’ assessment of expected economic development was the strongest since 2010 and expectations on future unemployment improved significantly. In addition, households’ outlook regarding their personal financial position improved marginally and, even though expectations on their capacity to save deteriorated slightly, they were more willing than three months ago to purchase big-ticket items. Interestingly, their expectations towards prices moderated significantly from October’s survey results, views seen as consistent with falling unemployment and related wage gains. All told, January’s survey painted consumers as highly optimistic towards the labor market and broader economic growth, while their assessment of household finances remained modest and in-line with the long-run average.