ZURICH: Private consumption grew at a weak pace of just 1.2% in 2017 compared to 2016 and 2015 . Economic uncertainties were still weighing on companies’ hiring intentions and the unemployment rate remained above 3% all year. This lead to a further decline in retail sales which are back at their 2007 level. Consumer confidence has been very low in 2017, at its 2009/2011 average (1.3), which explains the limited private consumption growth . With increased consumer confidence during the first quarter of 2018 and a brightening economic outlook, we expect private consumption growth to rebound from 1.2% in 2017 to 1.5% in 2018.Swiss exports fell by 0.7% in 2017, but the strong decline in imports due to weak private consumption and a depreciating Swiss franc allowed a positive contribution of 1pp in 2017.
With the trend expected to continue for the EUR/CHF, this contribution should be higher in 2018. Today’s PMI data points to a further acceleration in growth in the first half of 2018. The Swiss economy is therefore starting 2018 on a strong footing.”
