"Given the vibrant production activity and the solid volume of orders on hand, businesses evidently are hiring more personnel or are laying off fewer workers."
- Paul Ferley, assistant chief economist at Royal Bank of Canada
Activity at Swiss manufacturing sector expanded for an eight consecutive month in November, posting even stronger growth than a month earlier, suggesting a modest recovery is underway, while improvement in the economic sentiment is pointing at a greater confidence. A survey by Credit Suisse and procure.ch revealed on Monday a gauge of manufacturing activity accelerated to 56.5 last month, 2.3 points higher from 54.2 a month earlier and above analysts' expectations of a 55.1 figure. The indicator has been hovering above the 50 threshold since May, the level which indicates expansion of the sector. Meanwhile, production output stood at 58 in November, 1 point higher from October's reading. In addition to that, the employment sub-index added 3.8 points to 56.3. Nevertheless, stock of finished goods plunged to 45.9, and with rising demand and solid job growth this figure suggests that the turnaround time of goods is now shorter than earlier.
Resilient domestic demand was among the main pillars of the economy so far; however, its fortunes are closely tied to the Eurozone, which is only starting to recover. Even though both Swiss and Eurozone economies are starting to improve, risks for recovery are still high. The fact the SNB seen removing its cap on the Swiss Franc in early 2015, can be interpreted as a sign of future solid performance of the Alpine country.
© Dukascopy Bank SA