Swiss GDP in the fourth quarter 2015

Swiss GDP in the fourth quarter 2015

Switzerland’s real gross domestic product (GDP) grew by 0.4 % in the fourth quarter of 2015

GDP growth was supported by consumption expenditure from private house-holds and the public sector. Investments in construction remained more or less stable, while those in equipment declined. The balance of trade curbed GDP growth. The GDP deflator fell by 1.1 % compared with the corresponding quarter of the previous year. For the whole year 2015, quarterly estimates show a provisional GDP growth rate of 0.9% against 1.9 % in 2014. GDP growth at current prices for 2015 has been estimated at -0.4 % (GDP deflator for 2015: -1.3 %).

Consumption expenditure by households and non-profit institutions serving households (NPISHs) rose by 0.1 % in the 4th quarter of 2015. The categories of healthcare, food and beverages, and communication all made positive contributions to growth, whereas consumption in housing and energy declined. General government consumption increased by 0.6 % in the 4th quarter.

Investments in equipment dropped in the 4th quarter of 2015 (-0.9 %) due to the negative trend in vehicles and research and development investment, which had both fuelled growth in the previous quarters. The IT and other vehicles categories made positive contributions. Investments in construction more or less stagnated in the 4th quarter of 2015 (+0.1 %).

Exports of goods (excluding non-monetary gold, valuables and merchanting) grew substantially by 2.9 % in the 4th quarter. As in the previous quarter growth was primary boosted by chemical and pharmaceutical exports. The remaining categories, by contrast, either stagnated or declined slightly (watches/precision tools/jewellery). Imports of goods (excluding non-monetary gold and valuables) also enjoyed strong growth at 4.2 %. The chemical and pharmaceutical industry also provided the strongest impulse for growth on the import side. A slight decrease was recorded in the vehicles and precision instruments/watches/jewellery categories.

Exports of services dropped significantly in the 4th quarter (-3.2 %), while imports of services showed little change quarter on quarter (-0.3 %).

Most prices on the expenditure side of GDP continued to decrease, albeit to a slightly lesser extent than in the previous quarters. The deflator for private household consumption fell by 1.4 % compared with the 4th quarter of 2014. Prices for investments in equipment declined by 2.6 %. As in the previous quarters, foreign trade prices once again fell particularly sharply, with the deflator for exports of goods and services (aggregate, excluding non-monetary gold and other valuables) dropping by 5.1 % and that for imports (comparable aggregate) down by 7.5 %.

The deflator for GDP decreased by 1.1 %.

On the production side of GDP, manufacturing provided the strongest boost to growth in the 4th quarter (+1.9%). However, this growth was not broad-based. The chemical and pharmaceutical industry were the main driver for this increase in manufacturing. There was also an upward trend in value added in the construction (+0.6%) and transport and communication sectors (+0.5%). However, GDP growth was curbed by trading (-0.6%) and the hotel and catering industry (-1.6%).

Initial provisional results for 2015

The quarterly estimates would suggest an initial provisional GDP growth rate for 2015 of 0.9 % at constant prices (against +1.9 % in 2014) or a 0.4 % decline at current prices. This negative trend in nominal GDP, the first since 2009, mainly reflects the marked fall in the GDP deflator (-1.3 %).

On the expenditure side, consumption expenditure from private households (+1.1%) and the public sector (+1.7%) grew, as did investments in equipment (+3.2%), whilst investments in construction decreased slightly (-1.2%). Foreign trade of goods and services made a positive overall contribution to growth.

According to the provisional results, the production side of GDP saw an increase in value added particularly in healthcare and social work (+5.3 %) and in manufacturing (+3.1 %). Trading (-2.8 %) and financial services (-2.1 %) both declined over the year as a whole.

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