"Even though the distorting effects from the rise in the Swiss franc are fading out, we're still waiting for positive inflation rates"
- VP Bank economist Bernd Hartmann
Retail sales in Switzerland rose in November, however, at a slower pace, indicating weak domestic demand and consumer spending, the country's Federal Statistical Office reported on Wednesday. Retail sales added 2.9% in November, after a 2.7% drop in October, but slower than the 3.4% rise forecast by economists. On a monthly basis, retail sales gained 0.2%, reversing an October's 0.8% decrease. At the same time, sales of food, beverages and tobacco improved in the last month of spring, as they rose annually by 2.1%, compared with the 1.7% annual growth in October.
"Even though the distorting effects from the rise in the Swiss franc are fading out, we're still waiting for positive inflation rates. We are, however, expecting inflation rates to turn positive in coming months," VP Bank economist Bernd Hartmann said. "Giving up the exchange rate floor is not on the agenda (of the SNB) so there is no inflation pressure from the exchange rates."
"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," he added.
© Dukascopy Bank SA