Swiss economic sentiment improves but remains subdued

Sentiment in the Swiss economy remains subdued Keystone-SDA

Expectations for the Swiss economy remain subdued, according to the KOF Economic Barometer, which rose slightly in September but still signals caution.

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The economic barometer compiled by the KOF Swiss Economic Institute rose to 98 points in September. In August, it had fallen to its lowest level since October 2023 at 96.2 due to US President Donald Trump’s tariff hammering and thus fell below the medium-term average after rising to 101.1 points in July.

However, the August figure was revised significantly downwards from the previous 97.4 points. The economists surveyed by the news agency AWP had expected a further slowdown in September. The figure now published is above the forecast range of 96.3 to 97 points.

Mixed picture in sub-categories

Of the indicator clusters analysed, the outlook for the manufacturing industry and financial and insurance service providers improved. Meanwhile, the indicators for foreign demand declined, while the outlook for consumer demand remained unchanged.

The current business situation in the manufacturing sector (manufacturing and construction) presents a mixed picture. Exports and the general business situation are developing positively. By contrast, assessments of the inventory situation and production activity are less favourable and are under slight pressure.

In the manufacturing industry, several sectors stand out with pleasing developments: wood, glass, stone and earth, paper and printing products as well as the electrical industry are reporting positive signals. In contrast, the chemical and pharmaceutical industries as well as the automotive and mechanical engineering sectors are currently experiencing setbacks.

The KOF Economic Barometer is a so-called leading composite indicator. It is based on a large number of indicators and is intended to show how the Swiss economy is likely to develop in the near future.

Adapted from German by DeepL/jdp

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