2025

Since the new U.S. administration took office, geopolitical risks and international trade conflicts have significantly intensified. KOF has examined the risks and possible consequences for the Swiss economy. The findings show: trade conflicts can lead to declines in Swiss gross domestic product (GDP), ranging from fractions of a percent to over one percent per year on a sustained basis. In the case of severe and prolonged trade conflicts, the economy could fall into a recession.

The KOF Economic Barometer rises in March after a decline in the previous month. It continues to remain above its medium-term average since the beginning of the year. The outlook for the Swiss Economy remains robust.

Uncertainty is currently unusually high owing to the geopolitical strategy of the new US administration. Assuming that the international trade conflict does not escalate any further, KOF is forecasting that real sport-adjusted gross domestic product (GDP) will increase by 1.4 per cent in 2025. Although this international trade conflict is a burden, the fiscal stimulus expected in individual EU countries is boosting economic activity. KOF is predicting GDP growth of 1.9 per cent for 2026.  

In March, the coincident and leading Global Barometers show diverging movements. While the Coincident Barometer declines after a slight increase last month, the Leading Barometer rises for the second month in a row.

The KOF MPC figure for 6 March 2025 is 0.05. At today’s meeting, the ECB’s Governing Council decided to lower the three key ECB interest rates.

In February, the KOF Economic Barometer decreases. After an increase in the previous months, it remains above its medium-term average. While faced with headwinds, the Swiss Economy shows a robust outlook.