(03.04.2024) Switzerland's economic performance is projected to fall below the average in 2024. The Federal Expert Group on Business Cycles anticipates a GDP growth of 1.1%, adjusted for the impact of sporting events.
Particularly, the robustness of the service sector has enabled the Swiss economy to maintain its upward momentum into the fourth quarter of 2023. Nevertheless, the manufacturing industry saw a decline in its value added during this time, with the chemical and pharmaceutical sectors being notably affected.
Internationally, the leading global economies experienced divergent paths in the fourth quarter of 2023. The United States and China outperformed expectations, whereas the Eurozone remained stagnant, significantly weighed down by a decrease in Germany's GDP. This uneven landscape in the Eurozone is anticipated to persist into the upcoming quarters, casting a shadow over the prospects for Swiss exports.
In Switzerland, expectations for investments have been scaled back, attributed to underused industrial production capacities and an increase in financing costs. Nonetheless, bolstered by a favorable job market and a slowdown in inflation, private consumption is anticipated to continue its strong performance. The rise in the consumer price index is expected to moderate to 1.5% in 2024, a decrease from the 2.1% observed in 2023.
Economic risks continue to loom large in Switzerland and across global markets. Escalating conflicts in Ukraine and the Middle East have the potential to trigger raw material shortages. Additionally, with underlying inflation showing persistence, many economies are maintaining tight monetary policies.
However, experts are entertaining the prospect of an earlier rebound if global inflation decelerates faster than currently anticipated. They predict that by 2025, Swiss economic growth will normalize to 1.7%.
Information
Last modification 02.04.2024
