BERN: Swiss exports stagnated in October as rising foreign sales by chemical and pharmaceutical companies were offset by falling exports of paper and watches that have been hurt by slumping demand from Asia.
Overall exports fell by 1.5 percent year-on-year in real terms and by 4.7 percent on a nominal basis, the Federal Customs Office said on Thursday, coming in at 18.85 billion Swiss francs ($18.53 billion).
Analysts think that slumping exports may be further weakened by a strong Swiss franc. They are bracing for an expected European Central Bank rate decision on Dec. 3 that could deliver more quantitative easing in the euro zone and exert upward pressure on the franc.
Taking into account that the month had one fewer working day than October 2014, however, the office said exports actually rose in real terms.
Exports fell to all continents except North America. The trade surplus widened to a record 4.2 billion Swiss francs, as imports fell more than exports. Imports slipped a real 5.3 percent to 14.7 billion francs.
Nominally, Swiss exports have dropped each quarter of 2015, with the biggest slide in the third quarter, the worst for watch sales abroad since 2009.
Swiss watch sales have been particularly under pressure in Asia, where weakness in Hong Kong, China and Singapore has been compounded by a dive in South Korea. Watch exports from Switzerland — home to Richemont and Swatch — fell a real 13.2 percent to 2 billion francs in October.
While even greater slips in imports have compensated for slipping exports in Switzerland’s trade balance, analysts worry that Swiss manufacturers are ordering fewer components because they are making fewer products.
In October, imports of raw materials and semi-finished products shrank by a real 5 percent, the customs office said, driven by lower imports of electrical and electronic goods as well as a slide in metals.
Many export-reliant producers, such as those in the machine, electric and metal industry, have announced production cuts in Switzerland and other cost-cutting labour measures.
