Swiss GDP increased by 0.4% quarter-on-quarter in 3Q19, compared to 0.3% in 2Q19. But the good figure masks less favourable details – explains Charlotte de Montpellier – Economist, Switzerland at ING.
Key Quotes:
“Switzerland’s GDP grew by 0.4% in the third quarter of 2019, compared to 0.3% in the previous quarter. This growth was supported primarily by the export of chemicals and pharmaceuticals as well as energy. According to SECO (State Secretariat for economic affairs), without the boost from these two sectors, GDP growth would have been close to zero. Overall, the cyclical slowdown was confirmed. Private consumption growth slowed to 0.2%, from 0.3% in the previous quarter. Investments in capital goods and construction recovered slightly, but not enough to be a real boost to economic growth, as they only offset the sharp decline observed in 2Q.”
“Economic risks are on the downside. An intensification of trade tensions between the US and China, or a trade battle between the EU and the US, could have a significant impact on the Swiss economy. The same applies to Brexit without an agreement, or a very sharp deterioration in relations between the EU and Switzerland. Turbulence on the financial markets could also push the Swiss franc to appreciate and lead to a decline in Swiss exports.”
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