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Swiss exports are expected to stagnate this year before recovering in 2020. (Keystone / Steffen Schmidt) The Organisation for Economic Cooperation and Development (OECD) has revised its growth forecasts for Switzerland downwards for the next two years due to a global economic slowdown. After a strong 2018 (+2.5%), gross domestic product (GDP) growth should slow in 2019 (+1%), the OECD said on Tuesday. This compares...

Understand what the word “transitory” truly means in this context. It is no different than Ben Bernanke saying, essentially, subprime is contained. To the Fed Chairman in early 2007, this one little corner of the mortgage market in an otherwise booming economy was a transitory blip that booming economy would easily withstand. Just eight days before Bernanke would testify confidently before Congress, the FOMC had met to...

Swiss Franc The Euro has fallen by 0.43% at 1.121 EUR/CHF and USD/CHF, May 23(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Overview: The deterioration of the investment climate is spurring the sales of stocks and the buying of bonds. The dollar is firm. China and the US appear to be digging as if the trade tensions will remain for some time and the breech is beginning...

While our forecasts remain unchanged for now, external drags on growth prospects for the euro area look set to persist for longer than we had previously expected. A potential improvement in euro area growth in H2 2019 on the back of a revival in the global economy is in jeopardy due to the intensifying trade dispute between the US and China. The euro area is not directly affected, but its indirect exposure to this...

By far, the biggest problem in Economics is that it has no sense of itself. There are no self-correction mechanisms embedded within the discipline to make it disciplined. Without having any objective goals from which to measure, the goal is itself. Nobel Prize winning economist Ronald Coase talked about this deficiency in his Nobel Lecture: This neglect of other aspects of the system has been made easier by another...

UBS already implements a zero interest policy for savings accounts with over half a million Swiss francs. (© Keystone / Gaetan Bally) As of June 1, Switzerland’s largest bank will stop paying interest on adult savings accounts. Funds deposited in UBS savings accounts currently earn a rate of 0.01%, just like at Credit Suisse, the other major Swiss bank. Almost all other Swiss banks pay a small interest on saving...

Japan’s latest GDP report reveals some notable weakness in the economy despite the strong headline figures. The preliminary reading of Japanese GDP for Q1 shows that the economy grew by 2.1% q-o-q annualised, beating the consensus forecast of -0.2%. However, behind the strong headline figures, details of the GDP report reveal some broad-based weakening in momentum. Declining corporate capex and sluggish household...

Swiss Franc The Euro has fallen by 0.24% at 1.1253 EUR/CHF and USD/CHF, May 22(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Overview:  There is a nervous calm in the capital markets. Yesterday’s rally in US shares failed to excite global investors. China, Hong Kong, and Taiwan markets fell, while Japan was mixed. Foreign investors continued to sell Korean shares, but the...

Women, such as Swiss Railways chairwoman Monika Ribar, are still in a minority, but the gap is slowly closing. (© Keystone / Peter Klaunzer) For the first time, all of Switzerland’s top 20 companies have at least one woman in the boardroom. The finding by consultancy firm Russell Reynolds shows the slow but steady progress towards gender equality in the management of Swiss firms. Russell Reynoldsexternal link found that...

Many American observers argue that the trade imbalance gives the US an advantage in a trade war with China. The US enjoys escalation dominance in tariffs because Chinese imports of US goods are so much less than the US imports of Chinese goods. However, the focus on quantities may be misleading. For example, the ability to find substitutes for the more expensive tariff imports could be a critical part of the evaluation....