Switzerland: Depressed consumption drags economy deeper into recession
January 30, 2013
The KOF economic barometer - which is a leading indicator for future GDP growth - fell to 1.05 points in January, down from the revised 1.29 points recorded in December (previously reported: 1.28 points). The reading marked the fourth consecutive monthly drop and drove the index to the lowest level in eight months. The decline, which exceeded market expectations, suggests that the economy may slow down going forward.
According to KOF, the core GDP sub-indicator (which excludes the construction and banking sectors) as well as the construction sub-gauge fell over the previous month, pointing to less upbeat economic prospects in the coming months. Only the banking component rose slightly over the previous month, indicating better prospects in the sector. On a positive note, KOF reiterated that private consumption "is expected to have a positive impact on the Swiss economy again in the future, albeit to a lesser extent than at the end of last year".