The Swiss economy stalled in the second quarter as the improvement in household spending was insufficient to offset the weakness in exports and investment in construction.
Gross domestic product remained flat from the first quarter, when it accelerated to 0.5 percent, the State Secretariat for Economic Affairs said Tuesday. Economists had expected GDP to rise 0.5 percent in the second quarter.
The expenditure side of GDP showed a small positive impetus coming only from household consumption. The balance of trade made a small negative contribution, while a neutral development in investment.
Household spending advanced 0.2 percent, faster than the 0.1 percent growth in the prior quarter. Meanwhile, government spending decreased for the second straight time. General government expenditure slid 0.3 percent, but it was slower than the 0.7 percent sharp fall seen in the first quarter.
Investment remained flat on weak construction activity, following first quarter's 0.2 percent increase. Exports and imports climbed 0.6 percent and 0.9 percent, respectively.
On a yearly comparison, GDP growth slowed to 0.6 percent in the second quarter from 2.1 percent a quarter ago. The annual growth was forecast to slow moderately to 1.6 percent.
In its June monetary policy assessment, the Swiss National Bank forecast growth rate of around 2 percent this year, although it expected weaker global economic activity to hurt domestic hurt.
The SNB stands ready to intervene in the foreign exchange market to enforce the currency exchange rate at 1.20 per euro, President Thomas Jordan said in an interview with NZZ am Sonntag over the weekend.
"The franc is still highly valued," he said. "Enforcing the minimum exchange rate of 1.20 is absolutely central to ensure adequate monetary conditions in Switzerland."
New geopolitical risks have emerged and international macro data- mainly in Europe and Latin America, was weaker than expected. The environment for Switzerland has deteriorated, he said. His comments suggest that the bank will cut its GDP outlook at its September meeting.
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December 19, 2025 15:10 ET U.S. inflation data and interest rate decisions by major central banks were the highlights of this busy week for economics news flow. Employment data and survey results on the housing markets also gained attention in the U.S. In Europe, the European Central Bank and Bank of England announced their policy decisions and macroeconomic projections.