KOF Consensus with slightly higher GDP forecast for 2024
Published: Monday, Dec 18th 2023, 10:50
Updated At: Monday, Dec 18th 2023, 10:50
Volver a Live Feed
Economic experts are slightly more optimistic about the development of the Swiss economy in the coming year than they were three months ago. Meanwhile, inflation is forecast to be lower than previously.
The economists surveyed by the KOF Swiss Economic Institute as part of its Consensus Forecast expect real gross domestic product (GDP) to grow by 1.4% in 2024, according to a statement on Monday. The previous estimate was around 1.3 percent. The forecast for the end of 2023 remains unchanged at +0.8 percent.
For the first time, a sports event-adjusted GDP figure was also surveyed: here, the experts estimate an average of 1.2% for the coming year after 1.1% for 2023. As is well known, major football events such as the World Cup or European Championships as well as the Olympic Games distort Swiss GDP due to the licensing income of the sports associations based in this country.
This is why the adjusted figures can deviate relatively strongly from the unadjusted figures and are also somewhat more meaningful in terms of the economic outlook. In other words, experts do not expect significantly higher GDP growth in the coming year (as the unadjusted figures suggest), but rather virtually unchanged growth.
Lower inflation expected
Estimates regarding the labor market have remained unchanged. An average unemployment rate of 2.2% is expected for the coming year, which would correspond to a slight increase compared to the figure for 2023 (2.0%).
The forecasters have become somewhat more optimistic with regard to inflation. They now expect average annual inflation of 1.6% in the coming year 2024, compared to 1.8% in the September estimate. The forecast for 2023 - where 11 of the 12 monthly figures are already known - is 2.1% (old forecast: 2.2%).
According to experts, the decline in inflation is therefore progressing faster than previously expected. Most recently in November, inflation fell slightly to 1.4% despite rent increases. However, another (at least temporary) rise is expected in the new year due to higher electricity prices, further rent increases and an increase in VAT.
In line with the more optimistic inflation estimate, the survey participants have also adjusted their estimates for the expected interest rate trend downwards. For Saron, they expect a value of 1.71% in three months and 1.48% in 12 months, compared to the current value of 1.71%. Last September, they were still forecasting 1.88% for the three-month period and 1.92% for the 12-month period.
Expected interest rate trend already overtaken
The forecasts for long-term interest rates were also adjusted downwards. The respondents expect the spot rate for a ten-year German government bond to be 0.96% in three months (September: 1.28%) and 1.13% (1.50%) in twelve months. However, the latest developments may have already overtaken these forecasts: after a sharp fall in the last few weeks, the rate was recently quoted at just 0.56%.
Meanwhile, the experts surveyed expect little movement in the exchange rate trend. For the EUR/CHF currency pair, they forecast 0.95 in three months and 0.96 in 12 months (currently: 0.95), while for USD/CHF the estimates are 0.88 and 0.87 respectively (currently: 0.87). The forecasts have changed only minimally since September.
As far as the development of the Swiss Performance Index (SPI) is concerned, the short-term outlook is subdued according to the assessments. The consensus value of the SPI for three months from now is 14,650 points and roughly corresponds to the current index level (14,635). The forecast for 12 months from now is 15,330 points, which is slightly lower than in the September survey, but corresponds to an increase of 4.7% compared to the current value.
14 economists took part in the latest KOF Consensus Forecast, with the survey being conducted between December 1 and 13.
©Keystone/SDA
Spanish 
English 
German 
French 
Arabic