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ECONOMY

Switzerland has the ‘most resilient’ economy in the world – again

Switzerland has been hit hard by the Covid-19 pandemic, but the country’s economy remains the strongest in the world, a new study concludes.

Switzerland has the 'most resilient' economy in the world - again
Swiss economy is the strongest in the world. Photo by AFP

Even though the health crisis plunged Switzerland’s economic activity into a “historic” 8.2 percent slump in the second quarter of this year, the country still boasts the world’s most resilient economy, according to research by an insurance and reinsurance company Swiss Re. 

This is the third year in a row that Swiss top the global ranking, “reflecting their comprehensive economic strength against future crises”, the study reported

The country received top marks for all of the research criteria, including its monetary policy, low-carbon economy, labour market efficiency, and human capital.

Canada, Finland, and the United States took the second, third and fourth place. Norway, the UK, Netherlands, Sweden, Denmark, and Germany are in the top ten.

The Swiss Re report comes just days after figures from the State Secretariat for Economic Affairs (SECO) showed that In the second quarter of this year, Switzerland's Gross Domestic Product (GDP) suffered “the biggest decline since records of quarterly data began in 1980”.

READ MORE: Switzerland plunges into 'historic' recession

However, despite the slump, SECO stressed that in Switzerland, which has seen over 1,700 deaths and more than  40,000 cases, the “GDP decline remained limited in an international comparison.”

During the second quarter, Switzerland saw manufacturing slump nine percent, with growth in the country's sizeable pharmaceutical industry preventing a steeper decline.

Exports of goods, excluding precious metals and other valuables, plunged 9.4 percent.

While many of Switzerland’s industries, such as watchmaking, experienced a downturn this year, others, like arms exports, doubled in the first half of 2020. 


 

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ECONOMY

Swiss central bank announces big rate hike in inflation fight

The Swiss National Bank (SNB) raises the key interest rate by 0.75 percentage points, putting it back in positive territory at 0.5 percent.

Swiss central bank announces big rate hike in inflation fight

“The rate change applies from tomorrow, September 23rd 2022”, SNB said in a press release on Thursday.

It added that “inflation [in Switzerland] rose to 3.5 percent in August and is likely to remain at an elevated level for the time being”.

The latest rise in inflation is principally due to higher prices for goods, especially energy and food, according to the bank.

The SNB’s forecast for the evolution of inflation is, however, positive.

It forecasts that the rate will drop to 2.4 percent in 2023 and and 1.7 percent for 2024.

“Without today’s SNB policy rate increase, the inflation forecast would be significantly higher”, the bank said.

In mid-June, the SNB tightened interest rates by half a percentage point for the first time in 15  years. Since then, inflation in Switzerland has continued to rise. For August 2022, the statisticians reported inflation of 3.5 percent, after 3.4 percent in June and July.

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