Switzerland’s GDP Growth Dissapoints
Switzerland’s fourth quarter GDP growth was only 0.1% annualized between Q3 and Q4 of this year. Q4 GDP grew 0.6% from last year’s fourth quarter and full-year GDP growth in Switzerland was 1.3%, below growth in the Eurozone of 1.7%.
The culprit for the weaker growth was sluggish exports, which have struggled with the Swiss Franc continuing to hold unprecedented strength. At the beginning of 2015, the Swiss central bank surprised world markets by lifting a cap of 1.20 Swiss Francs per Euro it had imposed on the Swiss Franc-Euro exchange rate. Within minutes the Swiss Franc strengthened by about 30% versus the Euro until the exchange rate reached about 0.8 Swiss-Francs per Euro. The exchange rate today stands at 0.94.