Inflation Increases Slightly to 1.7 Percent in September
Published: Tuesday, Oct 3rd 2023, 09:20
Actualizado el: Viernes, Oct 13th 2023, 14:12
Volver a Live Feed
In September, Switzerland's annual inflation rate rose slightly for the first time in nearly half a year, but remains within the moderate range targeted by the Swiss National Bank (SNB) of 0 to 2 percent. In September 2023, Swiss consumer goods were 1.7 percent more expensive than in the same month of the previous year, according to the Federal Statistical Office (BFS). This marks an increase in inflation from 1.6 percent in the previous month. Economists surveyed by AWP had expected slightly higher values. In February, inflation was slightly higher than it is today, reaching 3.4%. Since March, it has been steadily decreasing, and in June it fell below the 2% mark for the first time since January 2022. Inflation remains relatively high for domestic goods. In the reporting month, these goods still cost 2.1 percent more than a year ago, while imports were only 0.5 percent more expensive. Among the main groups, "Food and alcoholic beverages" (+3.8%) or "Housing and energy" (+3.2%) were significantly more expensive than a year ago, while areas such as "Communication" (-2.6%) or "Transport" (-1.5%) were clearly cheaper. The core inflation rate, which excludes volatile goods such as food, energy and fuel, was recently at 1.3%, slightly lower than in August (1.5%). Seasonally adjusted, core prices have remained largely stable for the third month in a row and have risen by only 0.5% annually since March, according to Gianluigi Mandruzzato, economist at the private bank EFG. In comparison to the previous month, prices slightly decreased in September, with the so-called national consumer price index (CPI) falling by 0.1 percent to 106.3 points. According to the Federal Statistical Office (BFS), the decrease is due to various factors, including lower prices for hotels (-3.0%) and guesthouses (-12.0%), as well as cheaper air travel (-5.1%) and package holidays in Switzerland and abroad (-6.7%/-4.5%). In contrast, leisure courses (+7.9%), petrol (+2.4%), diesel (+2.9%), heating oil (+5.1%) or ladies' knitwear (+11.9%) have become significantly more expensive. The slight increase in the year-on-year inflation rate despite overall lower prices compared to the previous month is due to the so-called base effect: in the corresponding month of the previous year, prices had fallen by 0.2 percent, and thus more significantly. It is expected that the upward trend of inflation will continue over the next few months. For example, in October, higher rents or energy prices from the beginning of 2024 will have an impact on inflation. According to a comment from Oddo BHF, half of the rents will increase by 3 to 8 percent from October, which will further increase inflationary pressure. Economists are not alarmed by the latest data. The underlying inflationary pressure, emanating from services and rents, did not increase further in September, according to UBS economist Alessandro Bee. He also expects that the inflationary pressure will intensify in the coming months and that inflation will exceed the 2% mark again by the end of the year. A base effect in fuel prices is also likely to contribute to higher inflation, as oil prices had come down significantly in the second half of 2022. Despite this, Bee does not expect any further interest rate increases from the Swiss National Bank in the coming quarters. He believes that the slight increase in September should meet the expectations of the SNB. A further interest rate increase would only be feared if the underlying inflation pressure were to be significantly stronger than expected by the SNB. The September inflation figures are in line with the scenario of a gradually declining inflation. This is particularly encouraging as core inflation is decreasing. According to Gero Jung from Mirabaud, this development is in line with the international trend and has also reduced price pressure in Switzerland. Consequently, he does not expect an interest rate increase in December.
©Keystone/SDA
Spanish 
English 
German 
French 
Arabic