Swiss Government Cuts 2009 Economic Growth Forecast

The economic forecast for the next year has been cut by the Swiss government, as the US fallout driven by the housing recession and faltering export demand has damaged the growth prospects.

Aymo Brunetti, the state secretariat’s chief economist said that the latest economic forecast is definitely more cautious, because “exports have been the main driver of Swiss growth in recent years, especially in the financial sector. The numbers still look good for exporters, but the general environment has worsened considerably.”

Exports are dropping as a result of the slowdown in the US and Europe, coupled with the gaining strength of the franc to the euro to the tune of 5.1 percent adversely effecting exports of machines and precision instruments.

The domestic market on the other man still remain strong, as household incomes have actually risen this year and are expected to continue in this light and the Swiss economy as a whole is showing no ill signs as financial services exports will probably expand 3 percent in 2008 following on from a 14 percent growth in the previous year.

The Swiss economy can still be described as robust and the country still continues to profit from Europe and the slowdown is not as hard as expected, and by taking the fourth quarter into account the government forecast of 1.9 percent is clearly pessimistic.

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