"The construction industry is still the main driver of Swiss economic growth, although the turbulence in the neighboring euro-zone has eased somewhat recently."
-KOF Economic Research Agency
Sales at Swiss retailers, which are considered as a primary gauge of household spending and accounts for the majority of overall economic activity, improved more than expected in June and prolonged the streak of gains, suggesting the overall economic situation in the second quarter, may be not as bad as the SNB predicts. Figures from the Federal Statistics Office showed that sales picked up 2.3% annually, up from downwardly revised 1.5% registered in the preceding month, while on a monthly basis real retail turnover gained 0.5%, recovering from May's 0.3% drop. Sales excluding fuel advanced 2%, while sales of food, beverages and tobacco plunged 1.3% over the same period measures year-on-year. Report also showed that sales in non-food sector recorded a 4% monthly jump.
According to SNB's estimates, the economy should decelerate significantly in the second quarter, and afterwards the economic activity should start gaining pace, supported by developments in the global economy. For the whole 2013, the SNB expects the GDP growth of 1.0-1.5%. Last week, the FSO said that consumer prices remained unchanged in July from a year ago, after contracting 0.1% in June. A pick-up in consumer prices, strong rebound in retail sales and a stronger reading of KOF leading indicator are all pointing at stable development of Swiss economy.
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