KOF Economic Barometer: Economic Outlook Remains Stable
The KOF Economic Barometer for April points to an almost stable economic development. It has risen minimally, by 0.2 points, to 105.3 points. Although the Barometer currently does not reach the positive values seen at the turn of the year 2017/2018, the current value is clearly above long-term average. The Swiss economic outlook remains favourable.
In April, the KOF Economic Barometer rose slightly to 105.3 points from a revised 105.1 in March (in its first publication in March: 106.0). Although the overall brightening of 0.2 points is tiny, it is broadly visible in the economic sectors included. The indicator bundles for manufacturing, accommodation and food service activities, banking, construction and consumption all showed slight increases in April. An exception is the indicator set for export prospects; it deteriorated in April.
In the goods producing sector (manufacturing and construction), indicators of competitiveness and earnings development have increased. The indicators for employment development and inventories had a particularly dampening effect.
Within the manufacturing sector, prospects improved, especially for the chemical industry. The paper and wood industries should also pick up speed. By contrast, the metal and electrical industries are likely to feel more headwinds.
KOF Economic Barometer and reference time series: annual update
In September 2017, the scheduled annual update of the KOF Economic Barometer took place. The annual update of the Barometer concerns the following steps: redefinition of the pool of indicators that enter the selection procedure, update of the reference time series and renewed execution of the variable selection procedure. The updated reference series is the smoothed continuous growth rate of the Swiss Gross Domestic Product (GDP) according to the new System of National Accounts ESVG 2010, released in early September 2017, which takes into account the release of the previous year’s annual 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 273 indicators (instead of 272 as in the previous vintage) from a pool of almost 500 potential indicator series. They are combined using statistically determined weights.