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UBS outlook Switzerland Q4 2010 - The Swiss economy thrives despite the strong franc

Zurich / Basel Media Releases Switzerland

The Swiss economy continues to grow. UBS Research Switzerland thinks the domestic economy should thrive over the next two years, compensating for weaker exports.

UBS Research Switzerland expects the Swiss economy to enjoy surprisingly strong growth over the next two years, despite the strong Swiss franc weighing on exports. Various factors support this view.

For one thing, the treaty on freedom of movement and residence within the European Union has made it easier for companies to hire qualified staff. Brisk population growth since 2007 has also supported consumption and increased the demand for residential property. Given the Swiss National Bank's expansive monetary policy and the global economic upturn, UBS Research Switzerland thinks the Swiss economy should exceed most growth forecasts for 2011.

In concrete terms, UBS Research Switzerland expects real economic growth of 2.3% next year and 2.1% in 2012. This relatively strong growth should drive inflation up from its current level of almost zero to around 2% in 2012.

The quarterly UBS economic survey of industrial and service companies on their expected business development supports these forecasts. The survey reveals that companies expect the recovery to taper off somewhat in the fourth quarter after the strength seen earlier this year. The UBS economic indicator, based on the survey, has posted some very high values lately, indicating economic growth of 3-4% for the second half of this year.

The new UBS outlook Switzerland analyzes economic developments in Switzerland and abroad and presents the details of the UBS economic survey. UBS economists discuss the Swiss franc's prospects for the rest of this year and take a close look at the country's real estate market. Finally, the issue of corporate succession receives careful consideration.


Daniel Kalt
Chief Economist Switzerland
Tel.: +41 44 234 25 60

Caesar Lack
UBS Research Switzerland
Tel.: +41 44 234 44 13

Sibille Duss
UBS Research Switzerland
Tel.: +41 44 235 69 54

UBS publications and forecasts for Switzerland:

UBS Business Cycle Indicator and gross domestic product
(Change yoy in %)

Data (in %):

The UBS economic indicator: a barometer of the Swiss economy since 1975
Since 1975, UBS has conducted quarterly surveys of companies operating in Switzerland concerning their business outlook. UBS economists have drawn upon this data to develop an economic indicator designed to provide reliable forecasting of the outlook for the Swiss economy. The following survey elements flow into the calculation of the economic indicator: change in total incoming orders versus the previous quarter, projected change in orders for the next quarter, change in domestic and international incoming orders, production, finished goods inventories, staffing levels and order backlog.