Category Archive: Swiss and European Macro

Main Author George Dorgan
George Dorgan
George Dorgan (penname) predicted the end of the EUR/CHF peg at the CFA Society and at many occasions on SeekingAlpha.com and on this blog. Several Swiss and international financial advisors support the site. These firms aim to deliver independent advice from the often misleading mainstream of banks and asset managers. George is FinTech entrepreneur, financial author and alternative economist. He speak seven languages fluently.

Swiss Trade Balance January 2018: Imports Cross the 17 Billion Franc Mark

Although exports fell in January 2018 from the December peak, their trend remains upward. Imports, for their part, began the year with fanfare to sign a record result. In both traffic directions, chemicals and pharmaceuticals made rain and shine.

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Europe chart of the week – French unemployment

French unemployment fell surprisingly fast in Q4 2017, to a new cyclical low.France registered the largest drop in unemployment in about ten years in Q4 2017. In metropolitan France, the number of unemployed fell by 205,000 to 2.5 million people, pushing the ILO unemployment rate down to 8.6% of the labour force (-0.7pp), its lowest level since Q1 2009.

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Swiss Labour Force Survey in 4th quarter 2017: 0.6 percent increase in number of employed persons; unemployment rate based on ILO definition at 4.5 percent

The number of employed persons in Switzerland rose by 0.6% between the 4th quarters of 2016 and 2017. During the same period, the unemployment rate as defined by the International Labour Organisation (ILO) declined from 4.6% to 4.5%. The EU's unemployment rate decreased from 8.3% to 7.4%. These are some of the results of the Swiss Labour Force Survey (SLFS) conducted by the Federal Statistical Office (FSO).

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Euro area inflation: the Phillips curve and the ‘broad unemployment’ hypothesis

Monetary policy in 2018 is all about the Phillips curve. The extent to which wage growth and inflation respond to falling unemployment will shape the monetary tightening cycle. If recent price action is any guide, any surprise on that front could result in market overreaction and volatility spikes. The most elegant description of the current state of research was provided by ECB Executive Board member Benoît Coeuré last year, who described the...

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Europe chart of the week – Italian productivity

With less than 30 days to go, the Italian general election remains highly unpredictable. The new electoral system and the fact that 37% of seats are to be allocated on a ‘first-past-the-post’ system make projecting seats from voting intentions particularly hard. Importantly, Italy is going into this election with an economy that is performing relatively strongly relative to recent history. However, cyclical strength is masking structural...

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Swiss Producer and Import Price Index in January 2018: +1.8 YoY, +0.3 MoM

Neuchâtel, 13 February 2018 (FSO) - The Producer and Import Price Index rose in January 2018 by 0.3% compared with the previous month, reaching 102.2 points (December 2015=100). The rise is due in particular to higher prices for petroleum products, electricity and gas as well as metals and metal products. Compared with January 2017, the price level of the whole range of domestic and imported products rose by 1.8%. These are some of the findings...

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Switzerland: inflation edged lower in January

According to the Swiss Federal Statistical Office (FSO), the headline consumer price index (CPI) inflation eased to 0.7% y-o-y in January from 0.8% y-o-y in December, in line with consensus and our own expectations. Core inflation (CPI excluding food, beverages, tobacco, seasonal products, energy and fuels) also eased, from 0.7 % y-o-y in December to 0.5% y-o-y in January (see Chart 1), back to the level of October 2017.

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Swiss Consumer Price Index in January 2018: +0.7 YoY, -0.1 MoM

The consumer price index (CPI) fell by 0.1% in January 2018 compared with the previous month, reaching 100.7 points (December 2015=100). Inflation was 0.7% compared with the same month of the previous year. These are the results of the Federal Statistical Office (FSO).

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The Historical Warnings of Money

It’s interesting, to me anyway, that an image of the Roman goddess Juno remains to this day on the logo of the Bank of England. There are many stories about her role as it relates to money, but what cannot be denied is that the very word itself came to us from her temple. The Latin moneta was derived from the word monere, a verb meaning to warn. Moneta was Juno’s surname.

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Swiss Retail Sales, December: +1.5 Percent Nominal and -0.8 Percent Real

Turnover in the retail sector rose by 1.5% in nominal terms in December 2017 compared with the previous year. Seasonally adjusted, nominal turnover fell by 0.8% compared with the previous month. These are provisional findings from the Federal Statistical Office (FSO).

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Swiss Trade 2017: Exports at all-time high

Last year, Swiss foreign trade accelerated yet again relative to 2016: exports rose by 4.7% to reach a new record high. Imports grew by 6.9%, posting their strongest growth rate since 2010. Aside from the improved economic situation worldwide, the weakening of the Swiss franc and price trends played a decisive role in both directions of trade. With a surplus of CHF 34.8 billion, the balance of trade closed the year 6% (or CHF 2.1bn) lower than the...

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KOF Economic Barometer: Easing

In January, the KOF Economic Barometer does not continue its upward tendency, which started in September 2017, but has declined. However, despite the decline, the indicator remains well above its long-term average. It still indicates a more dynamic economic development than in mid-2017. The recovery of the Swiss economy is thus likely to continue, albeit with slightly less momentum than indicated in the past few months.

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Europe chart of the week – The beginning of the ‘re-anchoring’

Professional Forecasters survey shows a substantial improvement in economic growth and employment, consistent with the ECB’s own assessment.The ECB will be pleased by its latest Survey of Professional Forecasters (SPF). The headlines are unambiguously positive, fuelled by the uninterrupted improvement in economic data, with expectations of GDP growth and HICP inflation revised higher for the next couple of years, sometimes substantially.

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Euro area: Business activity expanding at its fastest pace in nearly 12 years

The flash composite Purchasing Managers’ index for the euro area increased to 58.6 in January from 58.1 in December, above consensus expectations (57.9). The services sector index rose, offsetting the decline in the manufacturing index . Companies also expressed growing optimism about this year’s outlook, with business expectations up to an eight-month high.

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Upside risks to wages from IG Metall negotiations

German wage negotiations are in full swing amid growing calls for strikes. This comes at a crucial time for the ECB as strong growth and falling unemployment are expected to feed into higher inflation. IG Metall is by far the most important union to watch, representing almost 4 million German workers and being seen as a benchmark, including in the car industry or the construction sector this year.

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Swiss Producer and Import Price Index in December 2017: +1.8 YoY, +0.2 MoM

The Producer and Import Price Index rose in December 2017 by 0.2% compared with the previous month, reaching 101.9 points (December 2015=100). Compared with December 2016, the price level of the whole range of domestic and imported products rose by 1.8%. The average annualised inflation rate in 2017 was 0.9%. These are some of the findings from the Federal Statistical Office (FSO).

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Switzerland: Inflation at a seven-year high

According to the Swiss Federal Statistical Office (FSO), consumer prices in Switzerland remained broadly stable at 0.8% y-o-y in December, in line with consensus expectations, meaning that Swiss inflation stayed at its highest rate in almost seven years at the end of 2017.

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Switzerland Unemployment in December 2017: Up to 3.3 percent due to winter, seasonally adjusted unchanged at 3.0 percent

Registered unemployment in December 2017 - According to the State Secretariat for Economic Affairs (SECO) surveys, 146,654 unemployed people were enrolled at the Regional Employment Centers (RAV) at the end of December 2017, 9,337 more than in the previous month. The unemployment rate rose from 3.1% in November 2017 to 3.3% in the month under review. Compared to the same month of the previous year, unemployment fell by 12,718 (-8.0%).

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Swiss Retail Sales, November: +0.2 Percent Nominal and -0.2 Percent Real

Turnover in the retail sector rose by 0.2% in nominal terms in November 2017 compared with the previous year. Seasonally adjusted, nominal turnover rose by 1.4% compared with the previous month. These are the provisional findings from the Federal Statistical Office (FSO).

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Swiss Consumer Price Index in December 2017: +0.8 YoY, unchanged MoM

The consumer price index (CPI) remained unchanged in December 2017 compared with the previous month, reaching 100.8 points (December 2015=100). Inflation was 0.8% compared with the same month of the previous year. Average annual inflation reached 0.5% in 2017. These are the results of the Federal Statistical Office (FSO).

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