Switzerland CPI (Sep.), Manufacturing PMIs (Sep.)

While Swiss inflation has risen since reaching a trough in June, it is likely to stay very weak in the near term. Meanwhile, the positive set of September manufacturing PMIs from Switzerland and Sweden indicate that the industrial rebounds remain in full swing, with order books filling up.
David Oxley Senior Europe Economist
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Nordic & Swiss Economics Weekly

Riksbank might rethink; Swedish gov’t on the brink

Against the backdrop of a red-hot housing market, the Riksbank might draw inspiration from the Swedish football team, which embodied one of the ideals of central banking in its opening Euro 2020 game by doing very little but still getting a result. We expect macroprudential policies to be tightened sooner rather than later, but it is not inconceivable that monetary policymakers follow Norway with a tightening cycle of their own at some point. The main thing to watch next week is a no confidence vote in Sweden on Monday, which seems likely to pass. While the short-term macro implications would be limited, it could exacerbate the near-term pressure on the Swedish krona.

18 June 2021

Nordic & Swiss Economics Update

Norges Bank confirms September rate lift-off

While the Norges Bank left its policy rate on hold at a record low of zero once again this morning, it all but confirmed that it will raise rates in September – which would be well ahead of the RBNZ and the Fed, for example. We expect the NOK to gain ground on the euro and the SEK by the end of the year.

I will be hosting a 20-minute “drop-in” conversation alongside Jonas Goltermann, who heads up our new FX Markets service, on the outlook for Norway and the Norwegian krone today at 2pm (BST). You can register for this here.


17 June 2021

Nordic & Swiss Economics Update

Policy tightening by SNB remains a distant prospect

While the Norges Bank will start hiking in Q3, and we now expect the Fed to raise rates twice in 2023, developments in Frankfurt will continue to set the tone at the Swiss National Bank. Having left the policy rate on hold at -0.75% again this morning, rate hikes by the SNB are a distant prospect.

17 June 2021

More from David Oxley

Nordic & Swiss Economics Weekly

Riksbank not marvelling at proposed Act changes

While many of the changes in the new proposed Riksbank Act are benign, the Bank argues with some merit that the new legislation would make it more difficult for it to use its balance sheet during times of crisis. All told, the changes will make the Bank more reliant on the repo rate in the future, which could make a return to negative rates more likely at some point. Next week, consumer price inflation data from May are likely to show that headline inflation slowed in both Norway and Sweden, but rose in Switzerland. Meanwhile, the Norwegian economy probably flat-lined in April, but the easing of restrictions means that May should be a lot better.

4 June 2021

Nordic & Swiss Data Response

Switzerland GDP (Q1 2021) & PMIs (May)

Data released this morning confirmed that the Swiss economy started 2021 on the back foot following a tightening in virus-related restrictions. However, activity will have gathered pace in Q2.

1 June 2021

Nordic & Swiss Economics Weekly

Swiss seven-year itch; lots to ponder at the Riksbank

The breakdown of the Swiss/EU Treaty talks has taken the headlines this week, but the Swiss economy appears to be galloping ahead in any case. While the belated release of Q1 GDP data next week is likely to show that output contracted as virus restrictions bit, business surveys suggest that the economy got into its stride in Q2 and the upside risks to our 2021 forecasts are building. Meanwhile, the releases of the PMIs from May next week are likely to show that industrial sectors remained in rude health.

28 May 2021
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