October

The KOF Economic Barometer has halted its downward movement, at least for the time being. At 94.7 points, however, the barometer is still well below its long-term average. The Swiss economy is therefore likely to grow with below-average rates in the upcoming months.

Successful summer season for the Swiss tourism sector: the number of overnight stays increased by 2.6% year on year. Overnight stays by guests from Switzerland rose particularly sharply. Although the outlook for the coming winter season is being slightly dampened by the more sluggish economy, it remains positive. KOF expects the number of overnight stays to grow by 1.8% in both 2019 and 2020.

The KOF MPC figure for 24 October 2019 is 0.21. The ECB reiterated the need for a highly accommodative stance of monetary policy for a prolonged period of time.

The extent of worldwide globalisation has recently increased only modestly. Protectionist tendencies in many parts of the world are likely to have a dampening effect. Social globalisation is hardly advancing at all. Switzerland, the Netherlands and Belgium are the most strongly globalised countries in the world overall.

The signals coming from the Swiss economy have deteriorated recently. The international environment has also changed. The outlook for the global economy has become less upbeat. KOF is therefore lowering its forecast for economic growth this year and next.

Growth in the euro area will be weak until the beginning of 2020, according to three research institutes: ifo in Munich, KOF in Zurich, and Istat in Rome. They expect growth to be only 0.2 percent in the third quarter and to reach just 0.3 percent in each of the two following quarters. This is down from 0.4 percent in the first quarter of 2019.