The monthly UBS Consumption Indicator reached 2.35 in April, up from a revised 2.09 in March and 2.01 in February. It has now exceeded its long-term average of 1.49 for 14 months in a row.

The UBS Consumption Indicator is calculated from five sub-indicators: new car sales, activity in the retail sector, 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. All sub-indicators contributed to April's strong rise, especially the exceptionally brisk business in the retail sector and positive consumer sentiment, which hit a six-year high in April. New car sales also had a positive impact, up 4.3% year-over-year in April, as did the monthly figures relating to overnight stays by Swiss nationals in Switzerland.

With a lead of approximately three months on official figures, the UBS Consumption Indicator points towards very lively Swiss private consumption, which may even have accelerated since the beginning of the year. The outlook remains promising, with improved employment and income prospects likely to support consumer spending in the coming months. Overall, UBS expects real private consumption growth of 2.1% in 2007, following an increase of 1.9% in 2006.

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

UBS publications and forecasts for Switzerland: www.ubs.com/economicresearch