The Swiss economy will gather strength in the second half of the year, paving the way for a normalization in interest rates in 2013, the Organization for Economic Cooperation and Development said.
Swiss gross domestic product may rise 0.9 percent this year and 1.9 percent in 2013, the Paris-based OECD said today. Consumer prices are expected to drop 0.5 percent this year before rising 0.1 percent in 2013, while the jobless rate is seen declining for a third straight year in 2013 to 3.7 percent, according to the group.
Switzerland’s economy is showing some signs of recovery after the central bank last year lowered its benchmark interest rate to zero and imposed a franc ceiling of 1.20 versus the euro to help protect exporters and ward of the threat of deflation. Consumer confidence increased in April and the KOF leading economic indicator jumped to a six-month high.
“Growth is expected to pick up from the second half of 2012 onward on the back of strengthening activity in Switzerland’s main trading partners, and unemployment is projected to decline slowly,” the OECD said. The Swiss National Bank’s “policy rate may need to rise gradually in 2013.”
Consumer spending may rise 1.2 percent this year and 1.6 percent in 2013, with exports of goods and services seen increasing 1.4 percent and 4.6 percent, respectively, according to the latest OECD estimates. Gross fixed investment will probably increase 2.8 percent in 2012 and 3.8 percent in 2013.
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