Another five months till Swiss inflation is higher?
When the European economy starts to expand again, who will hike rates first, the SNB or the ECB?
According to Swiss Statistics the inflation rate remained stable at 0.1% y/y, while the inflation measured by the European HICP standard was +0.3% y/y, slightly higher than in the previous month. This implies that Swiss HICP inflation is only 0.5% lower than the one in the euro zone (0.8%). Still in February 2012, the difference was 3.7%.
Prices of goods that make up 41% of the basket have fallen by -0.8%, while services (59% of the basket) are up 0.6%. While Swiss goods are rising in price by 0.5% y/y, foreign goods – 25% of total goods – have fallen by 1.2%. The reason for cheaper imported goods can be found in long-lasting contracts that incorporate the new FX rate only slowly and in cheaper prices of oil (-0.4% y/y) and clothes (-3.4% y/y). Read more about the drivers of Swiss inflation.
Still, the upwards trend of inflation, visible in prices of services and Swiss goods seems to have stopped. Services are up only 0.6% y/y and goods of Swiss origin only 0.5%, both values are 0.2% less than one month ago.
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Tags: Eurozone Consumer Price Index,inflation,Switzerland,Switzerland Consumer Price Index