Editions

KOF expects GDP to grow by 3.2 per cent in 2021. However, this forecast assumes that the pandemic situation does not deteriorate any further. The negative scenario predicts growth of only 0.6 per cent. Moreover, the differences between the individual sectors of the economy are considerable. Some have already returned to their pre-crisis levels, while for others this will probably not be the case until after 2021.

The epidemiological situation has deteriorated further in many countries, including across Europe, which is important for Swiss exporters. Although vaccination campaigns are now under way, restrictions are likely to remain in place in many areas. It will therefore be some time before the global economy recovers from the coronavirus crisis, the aftermath of which is likely to be felt for quite a while.

Climate change used to dominate the debate – until COVID-19 began to spread. Does the coronavirus crisis eclipse the climate crisis? Or is it indirectly creating a greener economy? This is what we will be discussing at the next KOF Prognosetagung on 22 October, with Swiss Airlines CEO Thomas Klühr, Microsoft Switzerland Director Marianne Janik, Swiss Re expert Nora Ernst, environmental scientist and Green National Councillor Bastien Girod and KOF Director Jan-Egbert Sturm.

The signals coming from the Swiss economy have deteriorated recently. Industry, for example, is reporting a decline in capacity utilisation. The international environment has also changed. Forecasts for the global economy have become less upbeat. Weaker international business activity and the recent appreciation of the Swiss franc will have consequences. KOF is therefore lowering its forecast for economic growth this year and next.

What influence does the economy have on income distribution? Are there still any differences in terms of gender equality, and what are their potential consequences, for instance for pensions? How can we ensure that the gates to the labour market remain open to all, despite digitalisation and automation? These are the core questions that will be considered by the KOF Forecast Day on 2 October.  

KOF has lowered its GDP growth forecast for this year from 1.6% to 1%. This correction is due to the international framework conditions which have deteriorated further in the last few months. In line with the subdued economic outlook, KOF expects the Swiss economy to operate slightly below capacity in 2019.  

Whilst the Swiss economy remains robust overall, its growth rate will slow this year to 1.6 per cent. Gross domestic product (GDP) is then forecast to rise by 2.1 per cent in 2020. Private consumption will provide a significant boost to the economy over the forecast period. Unemployment will remain low thanks to solid economic growth.

The KOF business situation is barely any different in October compared to the previous month. This means that the business situation of Swiss companies has not changed significantly since July of this year (See G 1). Optimism on the part of companies regarding future business trends has fallen back slightly. The Swiss economy is continuing to ride high, although with slightly less of a tail wind.

Swiss investment activities have continued at a high level for a long time now and KOF expects a further rise in the coming year. Nevertheless, there are signs that the end of the investment cycle is imminent.

The Swiss labour market is following a positive trend. According to the KOF forecast, the unemployment rate will remain low and will even decline slightly. The impact of the new job registration requirement is as yet unclear.

The FED is in the process of pushing interest up further and reducing its balance sheet. In the Eurozone, the ECB has also taken a further step towards abandoning its ultra loose monetary policy. This is the environment in which the Swiss National Bank is currently operating.

The Swiss economy is booming. Gross domestic product (GDP) for this year is set to rise by an impressive 2.9 per cent. International economic activity is providing a positive stimulus, and the domestic economy is boosting business activity as well. Unemployment is also set to fall as a result of the strong economy. KOF expects the rate of growth to slow slightly to 1.7 per cent next year before GDP growth will likely rebound to 2.1 per cent in 2020.

After a dry spell, the Swiss economy is slowly picking up speed (see G 1). Growth is increasingly driven by merchanting, while the other sectors – excluding retail – are moving sideways. Investments remain on the low side. The labour market is recovering gradually and inflation is still low.