The UBS consumption indicator increased in June from 1.02 to 1.60 points. The introduction of the CO2 tax starting 1 July partly explains the increase.

Zurich/Basel, 31 July 2012 – The increase by 0.58 points to 1.60 points in June is the third-largest increase in the UBS consumption indicator ever reported. This was primarily due to the huge increase in new car registrations, but other subindicators could also gain slightly.

Some 40,000 new cars were registered in Switzerland in June; this is by far the highest value ever reported. However, the record result is attributable to a special factor: it is likely that many cars were registered to build up stock in June, because cars with high CO2 emissions registered after 1 July will be subject to a one-time CO2 tax. Only the figures for the coming months will reveal the extent to which the cars registered in June will impact future registrations. Even apart from June's record value, more cars are currently being registered in Switzerland than ever before, which attests to the outstanding consumer sentiment in Switzerland. UBS expects that the domestic economy, especially consumption, will continue to post above-average growth and will at least partly compensate for the possible export losses. UBS expects economic growth of 1.3 percent for the year as a whole.

Calculation of the UBS Consumption Indicator

Calculation of the UBS Consumption Indicator
The UBS Consumption Indicator signals private consumption trends in Switzerland with a lead time of about three months on the official figures. At roughly 60%, private consumption is by far the most important component of Swiss GDP. UBS calculates this leading indicator from five consumer-related parameters: new car registrations, business activity in the retail sector, the number of domestic overnight hotel stays by Swiss residents, the consumer sentiment index, and credit card transactions made via UBS at points of sale in Switzerland. With the exception of the consumer sentiment index, all of this data is available monthly.

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UBS publications and forecasts for Switzerland: www.ubs.com/wmr-swiss-research

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