Growth of Swiss exports slowed in June and firms slashed prices to defend foreign market share as the strong Swiss franc took its toll. The data supports the Swiss National Bank's view that growth will slow this year due to the franc's rise to record peaks against both the euro and the dollar.
Exports from Switzerland rose by a real 3.1 percent in June to 15.797 billion Swiss francs, the Federal Customs Office said on Thursday. Exports to the EU - Switzerland's top trading partner - fell by a real 14.6 percent. In the chemicals industry, which is the biggest export segment, they rose by a real 8.4 percent but prices sank by more than 20 percent, the data showed.
"The strong franc is a danger for the economy," said Sarasin economist Alessandro Bee. The SNB forecasts growth to slow to around 2 percent and economists have repeatedly pushed back their expectations for a first rise in interest rates since the 2008 financial crisis.
Interest rate futures currently fully price in a 25 basis point rise in the SNB's benchmark rate target only in June of next year. "With the franc at this level the Swiss National Bank is not likely to raise rates," Bee said. The SNB's next policy review is in September.
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