Growth forecasts revised downwards for 2023

A woman in a supermarket with a long receipt.

(21.12.2022) With rising energy prices and sluggish foreign demand, the Swiss economy is experiencing a slight slowdown. According to the latest report from the Organisation for Economic Co-operation and Development (OECD), growth in real terms is expected to reach 0.6% in 2023.

Buoyed by a post-Covid recovery at the beginning of the year, growth reached 0.3% in the second quarter of 2022. However, it has lost momentum as consumer confidence has declined, influenced by inflation and soaring energy prices. In addition, the labor market remains highly stretched, with a very low unemployment rate and staff shortages in some sectors. In real terms, i.e. adjusted for inflation, Swiss GDP growth is projected to be 0.6% in 2023, before picking up again in 2024 to reach 1.4%.

In October 2022, global inflation reached 3 percent and will remain above the Swiss National Bank's (SNB) target of 2 percent per year in 2023, before normalizing in 2024. Core inflation, calculated without taking into account volatile energy and food prices, remained relatively moderate at 1.8%. In response to inflationary pressures, the institution guarantor of monetary stability raised interest rates by 1.25 percentage points to 0.5 percent between June and September 2022, ending the negative interest rates in place since 2014. The OECD expects interest rates to be raised to 2% in early 2023.

With emergency aid linked to the health crisis coming to an end, the federal budget should be in surplus in 2023 and 2024. To stimulate economic activity, the OECD is also calling on Switzerland to integrate foreign workers – especially Ukrainians – into its labour market quickly, by speeding up the process of recognizing professional qualifications obtained abroad.


Last modification 21.12.2022

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