Switzerland Domestic Demand (ann. var. %)

Domestic Demand in Switzerland

GDP grows at fastest pace since Q2 2022 in Q1

GDP rose 0.3% on a seasonally adjusted quarter-on-quarter basis in the first quarter, above the flat reading seen in the fourth quarter of last year. Q1’s growth was the fastest since Q2 2022. Moreover, the figure was above the expansions seen in the EU and the Euro Area (0.2% and 0.1% respectively), with Switzerland’s economy likely benefiting from comparatively low inflation and interest rates, as well as rock-bottom unemployment.

The upturn reflected improvements in private consumption, public spending, fixed investment and exports. Private consumption growth sped up to 0.6% seasonally-adjusted quarter-on-quarter in the first quarter, which marked the best reading since Q2 2022 (Q4 2022: +0.2% s.a. qoq). Public consumption flatlined in Q1 (Q4 2022: -0.1% s.a. qoq). Meanwhile, fixed investment rebounded 1.7% in Q1, contrasting the 0.1% decrease recorded in the prior quarter.

Exports of goods and services increased 1.2% on a seasonally adjusted quarterly basis in the first quarter, which contrasted the fourth quarter’s 0.5% contraction. In addition, imports of goods and services growth picked up to 3.1% in Q1 (Q4 2022: +1.2% s.a. qoq).

On an annual basis, economic growth was steady at 0.7% in Q1.