December

The KOF Economic Barometer fell only slightly in December and now stands at 107 points. The barometer remains above its long-term average. The Swiss economy should thus continue to develop positively at the beginning of 2022, if the economic activity is not impaired by the renewed spread of the virus.

The KOF MPC figure for 16 December 2021 is -0.03. At today’s meeting, the ECB’s Governing Council confirmed the need for an ongoing monetary policy accommodation so that inflation stabilizes at the inflation target.

The deteriorating epidemiological situation in Switzerland and throughout Europe has forced KOF to revise its economic forecast downwards. Under its baseline scenario, KOF expects gross domestic product (GDP) to grow by 3.4 per cent this year and 2.9 per cent in 2022. KOF is forecasting that an economic recovery will begin in the spring.

After a noticeable drop during the second semester of 2021, the Global Economic Barometers remain relatively stable in December compared to the previous month. The Coincident Barometer discontinues a sequence of decreases that began in July, while the Leading Barometer records its seventh successive, albeit modest, decrease, thereby remaining below its long-run average of 100 points and exposing the difficulties in maintaining the rate of recovery of the world economy.

International trade disputes caused a slight decline in globalisation in 2019. The most globalised countries in the world remain Switzerland, the Netherlands and Belgium, with the Netherlands replacing Switzerland at the top of the rankings. The latest KOF Globalisation Index does not yet include the effects of the coronavirus crisis.

The circular economy in Switzerland has great potential: this is shown by the data from the first representative BFH/KOF study of Swiss companies. Switzerland, as a location for innovation with a well-educated workforce and high quality standards, is well placed to make better use of the opportunities offered by the circular economy in the future.