Ongoing global trade disputes involving the United States are casting a potential shadow over Swiss economic growth, along with other international events, such as the Italian elections and Brexit. However, the Swiss economy is forecast to expand 2.4% this year and 2% in 2019.
The Swiss State Secretariat for Economic Affairs (SECO) noted in its spring forecastexternal link on Tuesday that positive developments in the domestic job and consumer markets and foreign trade give cause for optimism.
In December, SECO had forecast economic growth of 2.3% in 2018 and 1.9% for 2019.
But SECO added that external events could adversely impact Swiss economic fortunes. Earlier this month, President Trump said the US would impose tariffs on steel and aluminum exports to safeguard domestic jobs.
“Although the tariffs recently imposed on metal imports are unlikely to affect the Swiss economy very much, any escalation to a trade war between the major economic zones would have a considerable dampening effect in the medium-term,” SECO stated.
The report also reflected concerns expressed recently by the Swiss National Bank (SNB) that future volatility in the financial markets could strengthen the Swiss franc once more, to the detriment of Swiss exporters.
“The results of the recent Italian general election have made it difficult to form a government, the terms of the Brexit negotiations remain unclear and there are uncertainties in Switzerland’s relationship with the EU, too,” SECO added.