Swiss government predicts slower recovery

The Swiss government predicts a sluggish economic recovery despite a rise in consumer confidence Keystone

The Swiss government has cut its economic growth forecast for 2003, while figures showed a rise in consumer confidence in January.

The State Secretariat for Economic Affairs (Seco) revised its forecast downwards to 0.8 per cent from one per cent it had predicted in November.

Seco said market jitters caused by the possibility of war in Iraq were keeping the Swiss economy from bouncing back more rapidly.

The high value of the Swiss franc amid the global economic downturn was also impeding recovery, Seco said.

Consumers more upbeat

January’s figures on consumer confidence showed that the Swiss were more optimistic about their financial prospects for 2003.

The Swiss consumer sentiment index, based on a quarterly survey of more than 1,000 households, has risen by more than 14 points since October.

The survey also showed that more Swiss thought they would be able to save money in the coming year.

In a related development, consumer prices increased slightly in January, rising 0.1 per cent from December and by 0.8 per cent compared with a year ago.

The Federal Statistics Office said the increase was mainly due to price rises in the tourism, transport, health and leisure sectors, as well as for fuel.

Trade balance

The Finance Ministry on Thursday announced a record surplus in the trade balance for 2002 of SFr7.3 billion ($5.4 billion).

Switzerland ran a trade surplus of SFr805.8 million in December. Exports rose 11.5 per cent year on year with imports up five per cent, according to the Federal Customs Office.

swissinfo with agencies

Key facts

The Swiss government has revised its forecast for economic growth to 0.8 per cent for 2003, down 0.2% from November’s figure.

It said a possible war in Iraq was the main reason for the sluggish growth.

January’s consumer sentiment index showed a rise of 14 points since October.