Swiss Govt Forecasts Below-Average Growth

(RTTNews) - Switzerland's economy is expected to log significantly below-average growth though the year started vigorously, the State Secretariat for Economic Affairs, or SECO, said Thursday.

The expert group of SECO forecast gross domestic product to grow 1.1 percent this year, unchanged from the previous projection. Likewise, growth outlook for 2024 was maintained at 1.5 percent.

Domestic demand is likely to be the major contributor to the growth in 2023, the expert group said. On the other hand, foreign trade will set to contribute little to GDP growth.

The forecast is based on the assumption that there will not be any energy shortage with widespread production losses in the winter of 2023/24. Gas and electricity prices are projected to remain high by historical standards.

High inflation is expected to continue in the short-term. The government observed that inflation pressures remained high globally, posing pronounced economic risks.

The SECO forecast inflation to stabilize at 2.3 percent in 2023, slightly down from the previous outlook of 2.4 percent. The dampening effects of falling energy prices are offset by continuing price pressures in other areas.

For 2024, inflation forecast was retained at 1.5 percent.

The government said the economic slowdown is likely to affect the labor market, albeit with a lag. The jobless rate is projected to reach 2.3 percent next year from an estimated 2.0 percent in 2023.