"The latest data suggests growth in the Swiss economy in the coming months will be markedly stronger than a year earlier"
-Research company KOF
Amid signs of a pickup in the Eurozone, the pressure on the Swiss Franc eased, hence manufacturers are feeling more confident and the economy is benefiting. The labour market in the Alpine country was showing surprising resilience even in times of severe global crisis. Furthermore, domestic consumption and mood among consumers was constantly improving. All these factors forced analysts to express their views the cap on the Swiss Franc would be removed after the first quarter of 2015. Wednesday data, however, show the economy is not strong enough yet, as the UBS consumption indicator inched back to 1.28 in October, from 1.56 in September. The main downside pressure came from lower assessment of business conditions in the retail sector. Even bigger number of new car registrations and stronger consumer sentiment were not able to offset a decline.
After retailers showed some optimism during the last two months, a slight majority of respondents judged business conditions to be negative over the corresponding period. Franc's appreciation between 2009 and 2011, as well as lower margins, continued to dampen retailers mood. Amid these worrying signs, retail revenue in real terms flattened somewhat during the last year, posting a modest growth of just 1% in September compared with the same month a year earlier.
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