Switzerland’s growth will be modest in 2024, warns the OECD

Switzerland’s growth will be modest in 2024, warns the OECD
Switzerland’s growth will be modest in 2024, warns the OECD

Zurich (awp) – The sluggish economic activity at the start of the year is weighing on growth in Switzerland. Gross domestic product (GDP) should stand at 1.1% in 2024, before rising to 1.4% in 2025, according to OECD projections published on Thursday.

Weak external demand, an erosion of the purchasing power of Swiss households due to inflation and a tightening of financial conditions have weighed on growth, explains the Organization for Economic Cooperation and Development (OECD) in its report.

Inflation will increase temporarily towards the end of 2024, driven by increases in rents and electricity prices, but will nevertheless remain within the 0-2% range set as a target by the Swiss National Bank (SNB). The unemployment rate will increase slightly to 4.4%.

A further decline in external demand, disruptions in supplies and a sharp correction in housing prices are the main risks threatening activity.

Structural reforms are necessary to preserve living standards in Switzerland, says the OECD in its report, which cites in particular the increase in the effective retirement age and the increase in the activity rate on the market work, particularly among mothers and seniors.

cw/al

#Swiss

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