Inflation in Switzerland is at its highest in nearly 3 years

The Swiss Federal Institute of Statistics (FSO) announced preliminary data on the Consumer Price Index (CPI) for October.

Accordingly, annual inflation, which was 1 percent in September, was recorded as 1.5 percent in October. Market expectation was that inflation would increase to 1.3 percent in October.

While the data in question was the sharpest increase in annual inflation since December 2023, it remained below the December 2023 level of 1.7 percent. Consumer prices in the country increased by 0.2 percent on a monthly basis.

FUEL COSTS WERE THE MAIN ENGINE OF INFLATION

According to FSO data, the main driver of the rapid rise in October inflation was fuel costs. Gasoline prices increased by 40 percent compared to the same month last year due to the tightness in crude oil and fuel supply caused by the tension in the Middle East.

Core inflation, which excludes energy, fuel and seasonal fresh product prices, was 0.5 percent on an annual basis in October.

EYES ON THE MEETING OF THE SWITZERLAND NATIONAL BANK ON DECEMBER 10

Inflation data was above market expectations, although it remained within the 0 to 2 percent range targeted by the Swiss National Bank (SNB) for price stability.

While SNB officials refrain from commenting on the data, analysts point out that monetary policy pressure on the Bank may increase. SNB, which currently keeps the policy rate at 0 percent, will make its decision on the interest and monetary policy route at its meeting on December 10.