"Further increasing exports and consequently a broader based economic expansion are expected, since domestic economy, which has held up well since the financial crisis, should remain robust"
- Economists at the State Secretariat for Economics
Almost a month ago the UBS consumption indicator showed stronger-than-expected reading, supporting more positive outlook from the government. A gauge of private consumption rose to 1.43 last month from 1.26 in October, suggesting the Alpine country is likely to build up steam in 2014. At the same time, the indicator of business conditions in the retail sector, jumped to 6 in November, recovering from –1.5 a month earlier. Therefore, it was not a surprise that November's retail sales came above analysts' forecasts, posting a 4.2% gain on a yearly basis and 1.9% from a month earlier. Core retail sales, which does not include fuel, advanced 3.9%, accelerating from a 1.8% jump in October.
Even though data can be interpreted as a welcoming sign by Swiss policymakers, the Swiss Franc was little changed following the data, as potential improvement was already priced in. The Franc was trading at 1.2353 against the Euro, 1.4846 against the Sterling and 0.9060 versus the U.S. Dollar. Howbeit, the data confirms the earlier assessment made by the Swiss government that expected a stronger economic upturn over the next two years. This year the economy is likely to post a 2.3% growth, while the outlook for 2015 stands for 2.7%.
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