Switzerland Inflation July 2016


Switzerland: Consumer prices record the smallest annual decrease in 20 months

August 8, 2016

In July, consumer prices decreased 0.4% over the previous month, which contrasted June’s 0.1% increase but was slightly slower than market expectations of a 0.5% decline. July’s reading marked the fastest monthly drop in 12 months and it was mainly driven by lower prices for clothing due to end-of-season sales. Crude oil products, hotel lodging and air transport also recorded a decline in prices.

In annual terms, consumer prices fell 0.2% in July, which was above June’s result (-0.4% year-on-year) and marked the smallest annual decrease since November 2014. The annual average variation in consumer prices registered minus 0.9% in July (June: -1.0% year-on-year).

In June, the Central Bank revised its inflation forecasts and now projects that prices will drop on average 0.4% this year, which is up from the 0.8% drop it had been forecasting. For 2017, the Bank expects prices to rebound and increase 0.3%; the Bank had previously projected a 0.1% rise. Panelists polled by FocusEconomics expect consumer prices to fall 0.4% in 2016, which is up 0.1 percentage points from last month’s forecast. For 2017, panelists expect inflation of 0.5%.

Author: Marlène Rump, Senior Data Analyst

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Switzerland Inflation Chart

Switzerland Inflation July 2016 2

Note: Month-on-month changes and annual variation of consumer price index (CPI) in %.
Source: Swiss Federal Statistics Office (BFS).

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