OECD continues to forecast moderate growth in Switzerland
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Lifted by strong domestic demand, Switzerland’s economy is unlikely to take too great a hit this year from rising energy prices and a more uncertain global outlook, the Organisation for Economic Co-operation and Development (OECD) says.
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The organisation has trimmed its forecast for Swiss GDP growth in 2026 slightly lower. It expects an upturn from 2027, driven by a recovery in exports as key trading partners rebound from the energy supply shock.
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Real GDP, excluding sporting events, is expected to grow by 1.1% in 2026 and 1.5% the following year, the OECD said in a report published on Tuesday.
The organisation has made only a slight revision to its December forecast for 2026. Higher energy prices following the US President Donald Trump’s war against Iran at the end of February are being offset by the strength of the Swiss franc. While rising oil and gas costs are weighing on external demand and hitting exports, the domestic market continues to underpin the Swiss economy.
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Where Switzerland gets its oil and gas
Switzerland’s reliance on imports from the Middle East and the share of energy in its consumer price index are among the lowest in the OECD, the organisation notes. This reflects the economy’s low energy intensity, which limits its direct exposure to trade disruptions. Most exports to the US now face a 10% tariff, broadly in line with those applied to Switzerland’s competitors, while talks on a longer-term bilateral trade deal are still ongoing.
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The outlook is set to improve in 2027, as key trading partners recover from the energy shock and exports pick up. Headline inflation is likely to edge up in the near term on the back of higher energy prices, though it should stay within the Swiss National Bank’s 0-2% target range for price stability.
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Risks remain tilted to the downside, the OECD warns, with the energy shock and ongoing disruption to global supply chains potentially lasting longer than expected. Further tariffs cannot be ruled out, including on pharmaceuticals, which are a mainstay of Swiss exports.
A quicker recovery in Europe and other key trading partners could give growth an extra lift next year.
Amid a sharp rise in the Swiss franc – boosted in part by its safe‑haven status – the SNB has kept its key rate unchanged at 0% since June 2025, to prevent inflation from slipping below its 0-2% target range.
The OECD, which expects inflation to come in at 0.7% in both 2026 and 2027, says the SNB is unlikely to make any further changes to monetary policy this year.
Translated from French by AI/sp
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