Swiss economy rebounds in Q3 with forecast-beating growth
2012-11-29 12:08:36
The Swiss economy expanded more than expected in the third quarter fueled by strong consumption and goods trade, the latest figures from the State Secretariat for Economic Affairs (SECO) showed Thursday.
Gross domestic product expanded 0.6 percent sequentially in the third quarter, strongly recovering from a 0.1 percent contraction in the previous three months. Economists had expected just 0.2 percent growth. The latest growth rate was the strongest since the fourth quarter of 2010, when GDP rose 1 percent.
A breakdown of the data revealed that both private and public consumption and the balance of trade in goods contributed towards the growth in GDP. By contrast, export of services and fixed investments had a negative impact on overall national output.
Private consumption grew 0.1 percent compared to the second quarter, led by a sharp rise in spending on healthcare and communication . Government consumption and spending on social security increased 1.7 percent.
Export of goods, excluding precious metals, jewellery and gems as well as works of arts and antiques, increased 2.3 percent quarter-on-quarter. Goods import rose 0.8 percent.
Gross fixed investments fell 0.5 percent sequentially. The reduction was mainly attributable to investment in equipment, while metal industry and vehicle manufacturing also contributed to the decline. On the other hand, investment in construction continued to grow.
Year-on-year, GDP rose 1.4 percent in the third quarter after a downwardly revised 0.3 percent expansion in the second quarter. Economists had forecast a 0.9 percent rise in the third quarter.
The SECO expects the economy to grow 1 percent this year and 1.4 percent in 2013. In October, the KOF Economic Institute slashed its growth projections for the economy to 0.9 percent this year and 1.3 percent next year.
The Swiss National Bank Chairman Thomas Jordan said last week that the economy is likely to show weak growth dynamics in 2013 and may pick up momentum as the year progresses. The central bank forecasts 1 percent growth for the economy this year.
The SNB is scheduled to release its latest economic forecasts in December. The Swiss franc is still highly valued and is burdening many companies, especially in the current phase of modest global growth, Jordan said yesterday.
With economic growth weakening further in Europe, Switzerland's major trading partner, there can be hardly any boost external demand in the coming months, he said in a speech in Berne.
The central bank introduced the minimum exchange rate of CHF 1.20 per euro in September last year in order to avoid extremely negative developments in the economy due to intensifying crisis in Europe.