The Swiss Federal Expert Group on Business Cycles maintained its expectation for modest GDP growth at 1.1% for 2024, with improvement to 1.7% in 2025. Uunemployment rate is projected to remain stable at 2.3% in 2024 before rising to 2.5% in 2025. Notably, inflation forecast for 2024 has been revised sharply down to 1.5% from an earlier estimate of 1.9%, and is expected to slow to 1.1% in 2025.
The group also outlined risks to the Swiss economy, including geopolitical tensions in the Middle East and Ukraine, which could disrupt commodity markets. Prolonged period of restrictive international monetary policy may dampen global demand, impacting Switzerland’s recovery. Specific concerns were raised about Germany’s industrial slowdown and China’s economic cooling, which could affect Swiss foreign trade.
Conversely, there’s a possibility that the recovery could outpace expectations, especially if global inflation decreases faster than anticipated, boosting consumer purchasing power and leading to quicker monetary policy easing. This scenario would likely stimulate demand further.
Full SECO release here.
