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Swiss inflation slows again

Inflation in Switzerland was falling again after having picked up during the first two months of the year. The Swiss Consumer Price Index rose 0.2% in March compared with the previous month and 2.9% versus the same month a year earlier. The main drivers of price increases were air transport, package holidays and new cars, according to the Swiss Federal Statistical Office.

Alessandro Fezzi, LGT
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5 minutes
Swiss franc
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The slower pace of inflation comes as a relief to the Swiss National Bank (SNB) after inflation ticked up in February by 3.4% compared with the same month of the previous year, and 3.3% in January, reversing a falling trend that had lasted for several months at the end of 2022. The SNB responded by increasing rates in March by 50 basis points and SNB President Thomas Jordan made it clear that more rate hikes are possible this year, if needed to contain inflation. Altogether, Switzerland enjoys a much lower inflation than in most other European countries. Inflation in the euro area came in at 6.9% in March, more than double the rate in Switzerland.

Elsewhere in Europe, factory output was on the rise and input prices were down in March in the euro area economy. Nevertheless, the conditions at European manufacturing companies fell somewhat, with the eurozone manufacturing PMI falling to 47.3 points in March from 48.5 in February. A PMI below 50 represents contraction in the sector.

Equity markets in New York continued to rally with oil companies leading gains after Saudi Arabia and other OPEC+ countries announced oil output cuts of more than 1 million barrels per day over the weekend. The Dow Jones Industrial jumped 0.98% to end the day at 33,601.15 points and the S&P 500 gained 0.37%, closing at 4,124.51 points. On the Nasdaq, the major tech indices lost around 0.3%.

Markets in Asia were mostly up after the Reserve Bank of Australia kept its cash rate unchanged at 3.6%. The Australian dollar lost ground versus the US dollar after the decision announcement. Australia’s S&P/ASX 200 was trading just slightly in positive territory. Japan’s Nikkei rose 0.3% and South Korea’s Kospi was up 0.5%. In mainland China, the Shanghai Composite gained 0.3% and the Shenzhen Component fell 0.3%. Hong Kong’s Hang Seng Index dropped 0.6%.

Corporate news in focus: Credit Suisse annual general meeting.

Economic data in focus: German trade balance for February (08:00 CET)

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Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi,
Source: LGT Bank (Switzerland) Ltd.

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