Switzerland: Economic barometer rises more than expected in May
May 31, 2013
The KOF economic barometer - which is a leading indicator for future GDP growth - rose to 1.10 points in May from a revised 1.04 points in April (previously reported: 1.02 points). The reading represents the second consecutive improvement following six straight declines. In addition, the increase exceeded market expectations, which had the index rising to 1.07 points. The KOF Institute notes that "prospects for Swiss industry and construction have improved and the situation in banking is stable. However, the outlook for consumption is somewhat gloomier".
According to KOF, the monthly print reflected a slight increase in the core GDP sub-component (which excludes banking and construction). Moreover, the construction sub-component continues to improve, whereas the banking sub-gauge remained virtually unchanged compared to the previous month.
FocusEconomics Consensus Forecast panellists expect GDP to expand 1.2% in 2013, which is up 0.1 percentage points from last month's projection. For 2014, the panel expects economic growth to accelerate slightly to 1.6%.
Author: Ricardo Aceves, Senior Economist