BERN (Reuters) -The International Monetary Fund cut its growth forecast for the Swiss economy in its latest report on Tuesday, citing worsening geopolitical tensions and tariffs as a drag on economic performance.
The IMF expects the Swiss economy to grow by 1.3% this year, down from a previous 1.7% forecast. In its first view for 2026, the fund said it expects the Swiss economy to grow by 1.2%.
The figures are adjusted for the impact of sporting events, which distorts economic data because of broadcast income for Swiss-based organisations like soccer body FIFA and the International Olympic Committee.
The predictions for both years were below the long-term average of 1.8% and followed forecast downgrades by the Swiss government and the Swiss National Bank.
“With global headwinds, growth is projected to remain somewhat below potential in 2025-26,” the IMF said.
Risks loom particularly from “external factors”, the IMF said, highlighting potential appreciation pressures on the Swiss franc, which would weigh on exporters.
“Worsening geopolitical tensions and fragmentation, volatile energy prices, and uncertainty over trade policy and tariff levels could adversely impact confidence, exports, and investment,” it said.
In the run-up to 2030, annual Swiss growth is expected to gradually increase to around 1.5%, the IMF said.
The IMF expected Swiss inflation to remain low, seeing it at 0.1% by the end of 2025 before rising to 0.6% by the end of 2026, due to low interest rates and higher oil prices.
Weaker price developments have become a concern for the SNB, which last month cut its policy interest rate to 0%, its lowest level in nearly three years.
(Reporting by John Revill)
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