Swiss Shoppers Lured by SNB Bargains Get Extra Trams to Germany
(Bloomberg) — Tram 8, crossing the border from Basel to neighboring Germany, may be packed tomorrow as Swiss shoppers take advantage of their suddenly increased spending power.
A Swiss franc buys about 20 percent more today in Germany than it did yesterday morning after the Swiss National Bank abolished its three-year cap on the franc of 1.20 per euro. The two currencies were trading near parity today.
“We register high demand for means of transportation to Germany,” said Claudia Demel, a spokeswoman for the Basel’s public transport company. “This should be seen in the direct context of the abolition of the cap,” she said, adding that the frequency of trams has been increased to accommodate additional travelers.
Swiss shoppers frequently cross the border to neighboring countries to take advantage of prices that can be significantly lower. According to the price-comparison website, barometredesprix.ch, buying 53 typical food products such as cream cheese and coke at the grocery store Migros in Switzerland was 55 percent more expensive than at Kaufland in Germany.
For people in German-speaking Switzerland, trips to the German lake-side town of Konstanz, which boasts big shopping centers, is particularly popular. A survey on the merits of the SNB’s cap exit by the tabloid Blick gave readers the option of clicking “Konstanz, we’re coming!” One in five respondents chose that answer.
Swiss residents are allowed to import 300 francs ($345) of goods per person a day without paying duty and are also entitled to recoup value-added taxes. The Swiss Federal Customs Office didn’t respond to request for comment as to whether officers at the border might step up snap inspections.
Swiss consumers already spent about 10 billion francs abroad in 2013, according to market research firm GfK.
Geneva’s TPG has no plans to follow suit and boost public transport to France, according to a spokeswoman.
“The consumers will be the big winners,” said Jan-Egbert Sturm, head of the Zurich-based KOF Economic Institute. “For them, the daily consumption goods will get cheaper.”
–With assistance from Catherine Bosley in Zurich and Hugo Miller in Geneva.
To contact the reporters on this story: Jeffrey Vögeli in Zurich at jvogeli@bloomberg.net; Jan Schwalbe in Zurich at jschwalbe6@bloomberg.net To contact the editors responsible for this story: Elisa Martinuzzi at emartinuzzi@bloomberg.net Zoe Schneeweiss, Dylan Griffiths
