- Rene Weber, an analyst at Bank Vontobel
Switzerland's exports declined last month as a strong Franc curtailed demand in the European Union and Asia for Swiss chemicals, pharmaceuticals, machinery and watches. In real terms, outbound shipments plunged 4.9% from a year ago to 17.93 billion Swiss francs, according to the Customs Office, In nominal terms, however, exports plummeted 7.4%. Imports, in contrast, rose 0.2% in real terms to 14.19 billion francs, but were 8.3% lower in nominal terms. As a result, Swiss trade surplus in July was 3.74 billion francs, compared with 3.51 billion a month earlier.
Swiss watch exports, one of the key pillars of the Swiss economy, declined in July due to falling shipments to Asia, as Chinese tourists bought more timepieces in Europe. Exports fell 9.3% to 1.9 billion Swiss francs. Sales to China tumbled 40%, compared with a 49% increase in July 2014. Shipments were down 20% to South Korea and 29% to Hong Kong, offset partly by higher exports to Europe. Swiss watch industry has been struggling in China since 2012, when the country began a crackdown on lavish spending among government officials. The release of the Apple Watch is an additional reason of concern for the Swiss watch industry, as it may lead retailers to lower orders of timepieces amid expectations of increasing competition. Shoppers may also prefer an Apple Watch over Swiss watch is they are in similar price segments.
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