- Credit Suisse
Swiss trade surplus rose unexpectedly in June, the Federal Statistics Office reported. Trade balance of the Alpine country surged to a seasonally adjusted 3.578 billion francs, up from 3.409 billion francs in the previous month. Economists, however, had expected a 2.80 billion francs surplus in the reported month. Swiss real exports declined 0.9% in June on a monthly basis, following the 1.1% increase in May. At the same time, real imports surged 2.2% on month in June.
Swiss economic expectations deteriorated in July for the first time in five months, indicating growth in the Euro zone, Switzerland's top export market, will not be enough to offset the effect of the stronger Franc on the Swiss economy. A survey by the ZEW Institute and Credit Suisse Group, released last week, showed the overall headline index of investor and analyst expectations declined to minus 5.4 points in July, from a reading of 0.1 point in the preceding month. The Swiss government revised downwards its growth forecast for this year to 0.8% from the 2.1% it expected before the Swiss National Bank's decision to remove the Franc's cap on January 15. The SNB expects the economy to grow by "just under 1%." Moreover, the central bank will continue to take an active role in FX market to ease the upward pressure on the Swiss Franc, which is currently significantly overvalued.
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