Switzerland: Inflation falls to over two-year low in March
Inflation inched down to 1.0% in March from February’s 1.2%. March’s reading represented the weakest inflation rate since September 2021, and was in line with the Central Bank’s target of below 2.0%. A drop in prices for food and non-alcoholic beverages was the key reason for lower headline inflation. Inflation remained less than half the rate in the Euro area, thanks to Switzerland’s ingrained low inflation expectations and mild Swiss wage growth.
Accordingly, the trend pointed down mildly, with annual average inflation coming in at 1.6% in March (February: 1.8%).
Lastly, consumer prices increased 0.03% in March over the previous month, coming in below the 0.64% increase recorded in February.
Inflation should remain subdued ahead, which should give the Central Bank the confidence to continue to cut interest rates at upcoming meetings.