Switzerland: Consumer prices continue falling on annual basis
May 8, 2013
In April, consumer prices remained flat over the previous month, which was below both the 0.2% increase observed in March and market expectations of a 0.1% increase. According to the statistical office, the subdued reading is the result of lower prices for transport as well as for housing and energy, which compensated for higher prices in clothing and footwear.
As a result of the muted reading, annual consumer prices fell 0.6% in April, which followed a decline of the same magnitude in March. Consequently, the inflation rate sits well below the Swiss National Bank's 2.0% inflation target. Annual average variation in consumer prices, however, inched up from minus 0.6% in March to minus 0.5% in April.
The Swiss National Bank expects consumer prices to drop 0.2% this year. For 2014, the Bank expects prices to rise 0.2%. Panellists polled by FocusEconomics expect see inflation at 0.1% in 2013, which is down 0.1 percentage points from last month's forecast. For 2014, panellists expect inflation to rise to 0.8%.
Author: Ricardo Aceves, Senior Economist