Inflation Shows Signs of Slowing in Switzerland

2022.11.15 05:31

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The Swiss and Import Price Index was virtually unchanged in October, slowing down in annual terms to 4.9% against 5.4% a month earlier and against a peak of 5.9% in June.

The Swiss Producer and Import Price Index has slowed

In contrast to its larger eurozone neighbors, the producer and import price index is at the same level as in June. The US has the same result; in the Eurozone, they rose by 10.5%, Germany by 16%, and the UK by 2%. From this point of view, Switzerland’s inflation is the least problematic among almost developed economies with popular currencies.

However, it is noteworthy that members of the Swiss National Bank remain hawkish, warning yesterday of a willingness to intervene further in the market and noting that they continue to write down as a threat.

Historically, Switzerland has been characterized by low domestic inflationary pressures for various reasons ranging from capital inflows into the domestic banking system to a chronically substantial trade surplus and a high standard of living. And we can see that the central bank has not abandoned its values.

Indirectly, the rhetoric with the monetary watchdogs’ concern about inflation pushes the markets to buy the franc in anticipation of further currency interventions and an interest rate hike in the middle of next month.

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