The UBS Consumption Indicator rose from 1.45 to 1.51 points in March, indicating continued solid growth in Swiss private consumption. Improved sentiment among retailers and, most recently, the tourism sector sent out more positive signals.

Zurich, 27 April 2016 – The UBS Consumption Indicator rose from 1.45 to 1.51 points in March on the back of improved retailer sentiment. Despite the continued strength of the Swiss franc, flourishing shopping tourism and subdued consumer sentiment, the survey figures from the KOF Swiss Economic Institute at ETH improved to -7 index points (-10 index points in the previous month). The number of new car registrations, however, was down a little in March and prevented an even stronger rise in the UBS Consumption Indicator.

Tourism also started sending out more positive signals recently. Following a slow start to the winter season, February saw 1.6 million overnight stays by Swiss guests, which translates into a 2.7 percent increase year-on-year. The hotel business now has its hopes pinned on the summer. Last year's exceptionally beautiful summer will have whetted the appetite of many Swiss nationals to spend their vacations in their own country. The KOF thus expects the number of overnight stays at Swiss hotels by national and international guests to go up by around 2.6 percent this year.

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.


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Alessandro Bee, UBS Chief Investment Office WM
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UBS publications and forecasts for Switzerland: www.ubs.com/cio-swiss-views


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