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UBS consumption indicator: virtually no change in consumer sentiment

Zurich/Basel Media Releases Switzerland UBS News

The UBS consumption indicator remained virtually unchanged in July. An increase in new car registrations was balanced by gloomier consumer sentiment and a weaker retail sales.

Zurich/Basel, 28 August 2013 – The UBS consumption indicator remained virtually unchanged in July at 1.41 index points compared with the previous month (revised down from 1.44 to 1.41), continuing a trend that has been ongoing since April.

Swiss consumers registered significantly more new cars in July than in the previous month; new car registrations rose by 14.4% after figures are seasonally adjusted. Compared with the same month last year, the number of new car registrations was also up sharply, increasing by 5.3% to 26,333 new car registrations. Following a weak first six months which saw a considerable decline of 11.8%, the second half of 2013 began somewhat more positively for the automotive sector.

The business situation in the retail industry deteriorated in July, from -2 to -5 points. For two years now most retailers have assessed their business position as negative despite clearly positive economic growth during this period. The appreciation of the Swiss franc between 2009 and 2011 could be one of the chief factors explaining the poor retail performance, as retailers are still feeling the impact to this day. Prices in the retail trade have been under strong pressure as a result of the currency appreciation. Current retail prices (excluding fuel) are around 4% lower than two years ago. This fall in prices exerts pressure on sales and squeezes profit margins, adversely affecting the mood of retailers.

Consumer sentiment, which is surveyed by SECO and constitutes one of the five sub-indicators in the UBS consumption indicator, cooled slightly in the third quarter. Compared with the second quarter, consumer sentiment fell from -6 to -9 points and, as a result, now sits only marginally above the historical average.

How the UBS Consumption Indicator is calculated

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.


Media contact

Caesar Lack, UBS CIO Wealth Management Research
Tel. +41 44 234 44 13,

Bernd Aumann, UBS CIO Wealth Management Research
Tel. +41-44-234 88 71,

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