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UBS Consumption Indicator points to brisk private consumption

Zurich / Basel Media Releases Switzerland

The UBS Consumption Indicator climbed to 1.95 in January, its highest level since June 2006. The Swiss economy should thus continue to garner support from robust private consumption.

The monthly UBS Consumption Indicator, which had remained unchanged at 1.89 since October, edged up slightly to 1.95 in January. The indicator surpassed the January reading just once last year, in June. Overall, the UBS Consumption Indicator has now stood above the long-term average level of 1.49 for 11 months.

Of the five sub-indicators used to calculate the UBS Consumption Indicator, consumer sentiment showed a positive trend. The business trend in the retail sector also improved further, as revealed by the survey results of the Swiss Institute for Business Cycle Research (KOF) at the Federal Institute of Technology in Zurich. Furthermore, the favourable trend in the number of overnight hotel stays by Swiss nationals in Switzerland continued. On the other hand, new car registrations recorded a slump, declining 4.4% year-on-year in January to 17,553. The fifth variable incorporated in the calculation of the UBS Consumption Indicator is cumulative monthly credit card spending via UBS at points of sale in Switzerland.

With a lead time of three to four months on the official figures, the UBS Consumption Indicator thus signals a persistent robust pattern in private consumption as well as an overall solid state of Swiss domestic demand up to the outset of the year. This strong growth should nevertheless persist over the coming months thanks to upbeat income and job market trends. UBS forecasts real growth in private consumption of 2.1% in the current year, following 1.9% in 2006.

UBS Consumption Indicator and private consumption in Switzerland
(Private consumption: year-on-year change in %, UBS Consumption Indicator: index level)

Calculation of the UBS Consumption Indicator:

The UBS Consumption Indicator signals private consumption trends in Switzerland with a lead of about three months on the official figures. At 61%, private consumption is by far the most important component of Swiss GDP. UBS calculates this leading indicator from five consumer-related parameters: new car sales, the business situation in the retail trade, the number of overnight hotel stays by Swiss nationals in Switzerland, 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 these data are available monthly.


Daniel Kalt

Head of Swiss Economic Research

Tel. +41-44-234 25 60

Karin Schefer

Economic & Swiss Research

Tel. +41-44-234 43 94

UBS publications and forecasts for Switzerland: