Switzerland: Consumer sentiment sours in the August–October period on deteriorating economic outlook
November 4, 2019
Swiss households turned more pessimistic in the August–October period, with the index prepared by the State Secretariat for Economic Affairs (SECO) declining to minus 10 points from 8 points in May–July. Subsequently, the index still stands below its long-run average of minus 5 points and the zero-threshold separating pessimism from optimism among consumers.
Consumers’ drearier outlook was primarily due to their markedly more downbeat assessment of the economic outlook. The corresponding sub index plunged to minus 20 points and now lies below its long-run average of minus 9 points for the first time in three years. Moreover, consumers’ view of the labor market was gloomier, as they expect higher unemployment in the near-term, although they assessed job security as above average. On the upside, households were less pessimistic about their past and future financial situations, and were consequently slightly less hesitant to make major purchases. This suggests private consumption will likely remain moderate in the final quarter of 2019.
Author: Lindsey Ice, Economist