Switzerland: Inflation comes in at highest level since October 2008 in April
May 4, 2022
Consumer prices increased 0.37% over the previous month in April, following March's 0.57% rise. Looking at the details of the release, the change in the prices of housing and energy was broadly stable in April and prices for healthcare were broadly in line with the previous month. Meanwhile, transportation prices increased at a weaker pace. Moreover, prices for food and non-alcoholic beverages dropped.
Inflation came in at 2.5% in April, up from March’s 2.4% and above the Central Bank’s 2% target. April's reading marked the highest inflation rate since October 2008. Meanwhile, the trend pointed up mildly, with annual average inflation coming in at 1.4% in April (March: 1.2%).
Looking ahead, Russia’s invasion of Ukraine is leading to higher global commodity prices and lockdowns in China are affecting supply chains. These factors will keep inflation relatively high by recent Swiss standards over the coming quarters. However, upward pressures should be somewhat muffled by the country’s limited reliance on fossil fuels for electricity generation, and inflation will stay very mild in the broader European context.
Author: Oliver Reynolds, Economist