ZURICH (Reuters) -Switzerland’s economy grew by 0.3% during the third quarter, the government said on Friday, as the service sector helped offset stagnating manufacturing growth.
The rate – adjusted for sporting events – was up from the flat development in gross domestic product in the previous April to June period, and was better than the 0.1% forecast in a Reuters poll.
Year on year, the Swiss economy grew 0.9%, stronger than the 0.5% forecast.
“The international environment remains challenging, with value added in industry stagnating accordingly,” said the State Secretariat for Economic Affairs (SECO), noting however that the service sector was once again able to provide a support.
GDP in the European Union, Switzerland’s biggest export market, was flat in the third quarter, Eurostat said last month, while Swiss surveys have shown subdued economic activity.
Switzerland’s November manufacturing purchasing managers’ index remained below the government’s threshold of 50 for the eleventh month in a row, rising to 42.1 points, as production kept on contracting.
“The weakness in manufacturing has spread to the labour market, with the employment component dropping to 46.0 points, its lowest level since October 2020 and the second consecutive print below the growth threshold,” procure.ch and UBS wrote.
The Swiss government said in September it expects the country’s economy to grow by 1.3% this year, followed by a 1.2% increase in 2024, both slower than the country’s long term average growth rate of 1.7%.
It is due to give its latest forecasts on Dec. 13.
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