- Eveline Widmer-Schlumpf, Swiss Finance Minister
In Switzerland, deflationary pressures remained an acute threat in August, as the gauge of producer and import prices in the reported month declined at the fastest pace in more than six decades, while retail sales figure also posted a negative growth. According to the FSO, the PPI measure dropped 0.7% in August, missing the estimate of a 0.4% decline and following a 0.3% decrease in the preceding month. On an annual basis, the gauge plunged 6.8%, following a 6.4% slump in July. That was the biggest drop since April 1950, when the measure declined 7.1%. Moreover, the Swiss PPI has been falling steadily since October 2013. Amongst the product categories, which showed the biggest contraction in prices, were chemicals, medicaments and petroleum.
Meanwhile, July's real retail sales data from Switzerland surprised to the downside, as the measure dropped 0.6% from June, when it rose 1.2%. Measured on a year-on-year basis, retail sales printed a 0.1% decline, while markets expected a 1.5% pickup. However, July's reading is still much better than a 1.2% slump in June. More specifically, sales of food, beverages and tobacco were flat in July, while non-food sales declined 0.9%.
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