UBS lowers growth forecasts for Swiss economy in 2025

UBS believes that the main risks lie with the eurozone, Switzerland's most important foreign trade partner. Keystone-SDA

Economists at UBS, Switzerland's biggest bank, have lowered their growth forecasts for the country's economy next year, citing a slowdown in the eurozone as a factor.

The experts now anticipate growth in gross domestic product (GDP) of 1.3% in 2025, compared with 1.5% previously, according to a statement released on Monday. Adjusted for sporting events, growth should reach 1.5%, versus 1.7% previously forecast.

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The bank believes that the main risks lie with the eurozone, Switzerland’s most important trade partner. “A weaker-than-expected acceleration in economic activity in the eurozone is also likely to delay the recovery in Swiss industry, and thus put the brakes on Swiss growth in 2025”, say the economists.

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For 2024, UBS is still forecasting GDP growth of 1.4%, or 1.0% in adjusted terms.

Domestically, inflationary risks are weakening. The experts are revising their inflation forecast to 1.1% from 1.2% this year, and to 0.7% from 1.0% in 2025, which “supports the outlook for consumption”, they said.

Translated from French with DeepL/gw

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