Categories: Market

Below average growth: Swiss economy faces a tough time in 2024

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Next year, Swiss consumers are expected to be affected by higher health insurance premiums and rising rents. (archive image)

Specifically, the forecast for GDP growth in 2024 is +0.8 percent, according to the statement made on Tuesday. After a weak 2023, there are signs of another year of below-average growth.

It is said that the Swiss economy will start the new year with little momentum. New orders are missing in the industry and more and more companies are running out of orders every day. The strong franc creates an additional burden for the export sector. And because of high interest rates in general, relatively little is invested.

According to Raiffeisen experts, losses in purchasing power also negatively affected consumption dynamics. The purchasing power of many Swiss people will decline in 2024 due to higher health insurance premiums, rents that will likely continue to rise, and wages that will also rise only modestly.

This is positive for inflation. And this time the worst is definitely over. Average annual inflation is estimated to be 1.8 percent.

The peak of the interest rate cycle has likely been reached, according to economists at the banking group. They now expect the Swiss National Bank (SNB) to cut interest rates for the first time by the end of 2024 to offset upward pressure on the franc and avoid exposing the export sector to further headwinds.

(SDA)

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Source :Blick

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