The Swiss economy will likely expand at a faster-than-estimated pace this year, the latest report from the State Secretariat for Economic Affairs (SECO) showed Tuesday.
SECO revised up its forecast for the gross domestic product this year to 0.8 percent from 0.5 percent projected in December. Meanwhile, the growth prediction for 2013 was cut down marginally to 1.8 percent from 1.9 percent.
The report said that a further deterioration in economic activity is unlikely. The government expects exports to grow much faster than estimated in December. Exports are now forecast to grow 1.3 percent this year and at a much faster pace of 4.5 percent in 2013.
The report said that problems surrounding the euro area has alleviated somewhat since the beginning of the year. Business surveys in Switzerland are also showing signs of stabilization.
SECO forecasts three-month Libor rate to remain at 0.1 percent this year and rise to 0.2 percent in 2013. The trade weighted real exchange rate index is seen falling 2.7 percent in 2012 after 10.2 percent increase last year. The index is expected fall 1.7 percent in 2013.
Consumer spending is forecast to rise 1.2 percent this year, stronger than 1.1 percent growth estimated in December. In 2013, personal consumption growth is seen at 1.6 percent. Unemployment rate is projected to rise 3.4 percent in 2012 from 3.1 percent last year. This will rise further to 3.7 percent next year.
The consumer price index will decline 0.4 percent this year compared to the December forecast of 0.3 percent fall, SECO said. The CPI is predicted to rise 0.4 percent in 2013, compared to initially forecast 0.3 percent.
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