"Evidently, the situation for industry has stabilised, although it is too soon to talk about a sustainable recovery"
- Swiss SVME purchasing managers' association and Credit Suisse
Switzerland's key manufacturing output index slowed slightly in June, while the general trend remains positive, suggesting the economy is developing albeit slowly. The Swiss Purchasing Managers Index rose to 51.9 points last month, down from 52.2 points in May, below analysts' expectations of a 52.5 reading. Despite slowdown, a gauge of manufacturing output is still above the 50 mark, which separates growth from contraction, for a third consecutive month. The improvement was mostly driven by a strong domestic demand, as there was a significant increase in purchases and production.
Analysts are expecting the nation's manufacturing sector to expand further; however, companies still appear to be sceptical, as they are still showing a little willingness to increase their spending. Last week the SNB said the cap on a Franc is still vital, and as long as they maintain it, the economy is less likely to be affected by the global slowdown and the financial and debt crisis in the neighbouring Eurozone. 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%.
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