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UBS Consumption Indicator: falling import prices lend support

Zurich Media Switzerland

The UBS Consumption Indicator remained virtually unchanged in September, at 1.65 points. In spite of the more pessimistic mood in the retail sector, the slightly renewed rise in new automobile registrations indicates further steady growth in consumption.

Zurich, 27 October 2015 – At 1.65 points, the UBS Consumption Indicator remained virtually unchanged in September from August's 1.64. The number of newly registered automobiles rose slightly for seasonal reasons. Over the first three quarters of the year, the sub-indicator has increased 9% compared to last year. Lower prices for foreign-produced consumer goods in Swiss francs, such as automobiles, may be the likely reason. Since the start of the year to September, import prices fell by almost one-tenth, according to the index calculated by the Swiss Federal Statistical Office (FSO).

The low interest rate environment is also driving purchases of consumer durables. On the other hand, the Swiss retail sector remains sluggish, as currency fluctuations have little impact on prices where production costs are incurred mostly in Switzerland. Retail prices, unlike imports, remained stable as a result, depressing consumption in a trend compounded by shopping tourism, as Swiss consumers looked for bargains over the border. In September, the confidence index published by the KOF Swiss Economic Institute at ETH Zurich worsened month-on-month, reflecting gloomy expectations in the retail sector.

Sources: Seco, UBS

How the UBS Consumption Indicator is calculated
The UBS Consumption Indicator signals private consumption trends in Switzerland with a lead time of one to three months on the official figures. At more than 50%, private consumption is by far the most important component of Swiss GDP. UBS calculates this leading indicator from six 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, employment figures and credit card transactions made via UBS at points of sale in Switzerland. With the exception of the consumer sentiment index and employment figures, all of this data is available monthly.

UBS Switzerland AG


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Studer Dominik, UBS Chief Investment Office WM
Phone +41-44-234 81 74,

Sibille Duss, UBS Chief Investment Office WM
Phone +41-44-235 69 54,

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