"The latest turbulence in the Eurozone and recent slight appreciation of the Swiss franc has slowed - though not halted - the recovery in Swiss economic activity"
- Credit Suisse
Switzerland's key manufacturing output index contracted in March, as a slight appreciation in the Swiss Franc and renewed weakness in the Eurozone dragged on demand. The Swiss Purchasing Managers Index fell to 48.3 points last month, down from 50.8 points in February, below analysts' expectations of a 50.5 reading. A gauge of manufacturing output fell below the 50 threshold, which separates growth from contraction, for a first time since December. Swiss economy expanded in the last quarter of 2012 by 0.2%, while the KOF barometer of Swiss economic sentiment fell less than expected, giving weight to claims the economy is on the verge of turning a corner. The Eurozone is nation's biggest trading partner and confidence in the Swiss manufacturing sector is directly linked to developments in the region.
"The latest turbulence in the Eurozone and recent slight appreciation of the Swiss franc has slowed - though not halted - the recovery in Swiss economic activity," said Credit Suisse and the SVME purchasing managers' association.
"It is doubtful that Switzerland is already on a sustainable recovery path. The economic problems in the Eurozone are having an increasingly strong impact on the Swiss economy," VP Bank economist Bernd Hartmann said.
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