Switzerland's economy is set to expand significantly below average in both 2023 and 2024, the State Secretariat for Economic Affairs, or SECO, said Wednesday.
In the latest quarterly report, the government upgraded its 2023 growth forecast to 1.3 percent from 1.1 percent citing strong growth in the first quarter. The economy is projected to log weak growth in the second half of the year.
The expert group of SECO said consumer spending will provide some support given the strength in the labor market conditions.
However, the appreciation of the currency together with sub-par global demand will damp goods exports and falling capacity utilization and rising interest rates will curb investment activity, the group noted.
The expert group anticipates weak growth in equipment investment and a decline in construction investment for 2023 as a whole.
In 2024, recovery in global demand will support Swiss exports but consumer demand would probably lose some momentum, the SECO said. Growth outlook for 2024 was downgraded to 1.2 percent from 1.5 percent.
Inflation forecast for 2023 was lowered to 2.2 percent from 2.3 percent. By contrast, inflation outlook for the next year was lifted to 1.9 percent from 1.5 percent.
The unemployment rate is projected to average 2.0 percent this year and to reach 2.3 percent in 2024.
