Swiss Consumer Confidence, Services Expansion Improve; Factory Growth Slows

BRUSSELS (Alliance News) - Switzerland's consumer confidence improved further in the three months ...

Alliance News 1 February, 2019 | 11:33AM
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BRUSSELS (Alliance News) - Switzerland's consumer confidence improved further in the three months to January as expectations regarding the labor market and personal financial situation improved, survey data from the State Secretariat for Economic Affairs, or SECO, showed on Friday.

Elsewhere, the purchasing managers survey from Credit Suisse and showed that manufacturing growth slowed in January, while services expansion gained further on the back of healthy order book balances. The consumer confidence index fell to -4 from -6.1 in October. Economists had forecast a score of -5. The index score remained above its long-term average of -9.

The latest reading was the highest since the second quarter of 2018, when it was 1.9.

"The sentiment has remained stable overall, with signs of a recovery and of a slowdown broadly balanced," the SECO said. The survey showed that the assessment of the general economy has deteriorated amid a sharp decline in the gross domestic product and the weaker expectations regarding outlook suggest that consumers expect the slowdown to continue.

"Consumers are therefore predicting a weaker general economic situation but not a recession," the SECO said.

In December, the SECO slashed the growth forecast for this year to 1.5% from 2%, citing weak domestic demand.

The Swiss National Bank has forecast nearly 1.5% growth for this year.

The Swiss economy shrunk 0.2% in the third quarter and the performance likely remained weak in the final three months of 2018.

The foreign demand for Swiss products is expected to flatten out and the export economy to lose momentum with the euro area likely to slow faster than estimated.

Separately, the Federal Statistical Office reported on Friday that retail sales decreased 0.3% year-on-year and 0.2% from the previous month in December. The Credit Suisse/ survey showed that the manufacturing Purchasing Managers' Index dropped to 54.3 from 57.5 in December. Economists had forecast a score of 56.4. The services PMI rose to a four-month high of 59.8 in January from 56.2 in December. A PMI score above 50 suggests expansion in the sector.

Copyright RTT News/dpa-AFX

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