"The construction industry is still the main driver of Swiss economic growth, although the turbulence in the neighboring euro-zone has eased somewhat recently"
- Peter Dietrich, director of Machinery industry lobby group Swissmem
A gauge of domestic consumption in Switzerland declined marginally last month, as consumer sentiment worsened and retail sales fell, offsetting an increase in new car registrations, UBS said Wednesday. A composite index, combined of 5 economic indicators, stood at 1.41 in July, little changed from previous month's score of 1.44, prolonging a streak of declines that has been ongoing since April. The main positive contribution came from car sales, where the number of new car sales soared 14.4% month-on month, while on an annual basis indicator gained 5.3%. However, this contribution was offset by a further deterioration of business situation in the retail sector, as constantly falling consumer prices continued to squeeze retailers' profit margins. Moreover, consumer mood cooled slightly in the third quarter, with the corresponding index hovering around its historical average.
Also Wednesday Switzerland has finally has given the go-ahead to draft a plan with the U.S. for the nation's banking sector to settle a recent tax-evasion dispute. Even despite the fact the U.S. representatives have not put a signature to the agreement yet, both the cabinet and the Swiss Bankers Association are sure the deal should finally settle latest misdemeanours and would satisfy all parties. Moreover, this programme is expected to allow Swiss banks to settle their legal question with the U.S. quickly and convincingly.
© Dukascopy Bank SA