KOF Economic Barometer June: Prospects Are Brightening again

The KOF Economic Barometer, with a new reading of 105.5, points visibly above its long-term average in June 2017. The strongest impulses contributing positively to the dynamics of the Barometer stem from manufacturing. At the same time, slightly negative impacts come from the indicators of the constructing sector as well as from the ones for the export development.

Within the manufacturing sector, the improved outlook manifests itself primarily in the wood-processing, food and metal industries. These positive dynamics are somewhat compensated by a more negative outlook by architects.

The improved sentiment in the manufacturing sector is primarily the result of a more optimistic judgment of the incoming orders in June 2017. However, it also reflects an improvement of the indicators for the overall business climate and competitiveness, which has increased again compared to the previous month.

KOF Economic Barometer and reference time series: annual update

In September 2016, the scheduled annual update of the KOF Economic Barometer took place. The annual update of the Barometer concerns the following stages: redefinition of the pool of indicators that enter the selection procedure, update of the reference time series, a new execution of the variable selection procedure and a procedure to estimate missing monthly values of quarterly variables. The updated reference series is the smoothed continuous growth rate of Swiss GDP according to the new System of National Accounts ESVG 2010, released at the end of August 2015, which takes into account the release of the previous year’s annual Gross Domestic Product (GDP) data by the Swiss Federal Statistical Office. As a result of the indicator variable selection procedure, the updated KOF Economic Barometer is now based on 272 indicators (instead of 238 as in the previous vintage) from a pool of more than 400 potential indicator series. They are combined using statistically determined weights.