Switzerland: Annual consumer prices drop for 16th straight month
February 12, 2013
In January, consumer prices fell 0.3% over the previous month, which exceeded the 0.2% decline observed in December but was in line with market expectations. According to the Federal Statistics Office, the monthly drop reflected lower prices for clothing and footwear.
Building on the monthly drop, annual consumer prices fell 0.3% in January, which followed a 0.4% decline in December and marks the 16th consecutive month of deflation. As a result, the inflation rate currently sits well below the Swiss National Bank's 2.0% inflation target. Meanwhile, annual average consumer prices fell 0.7% in January.
The Swiss Statistics Office sees inflation rising to 0.2% this year and next. In contrast, the Swiss National Bank expects consumer prices to drop 0.1% in 2013. For 2014, the Bank expects inflation to rise to 0.4%.
Author: Ricardo Aceves, Senior Economist