The merchandise trade surplus narrowed in June from May's marginally smaller revised CHF5.44 billion to CHF4.82 billion. However, more importantly, it was well above the CHF3.65 billion posted in the same month in 2022. The annual improvement reflected a 2.3 percent yearly increase in exports compounded by a 3.0 percent decrease in imports.

Seasonally adjusted, the surplus stood at CHF3.31 billion, down from CHF4.37 billion in May. The decline here was partly due to a 1.7 percent monthly fall in exports but also to a 3.7 percent advance in imports, the latter's first rise in four months. The real trade balance also deteriorated as export volumes dropped 0.9 percent while their import counterpart climbed 1.8 percent. However, over the second quarter as a whole, net export volumes rose more than 6 percent, implying a positive contribution to the period's real GDP growth.

The merchandise trade balance measures the difference between the total value of Swiss merchandise exports and imports. The focus is on the balance of trade in goods, excluding precious metals, gemstones, works of art and antiques. This is provided in unadjusted and seasonally adjusted measures for cash and volume.

Changes in the level of imports and exports along with the difference between the two (the trade balance) are a valuable gauge of economic trends here and abroad. While these trade figures can directly impact all financial markets, they primarily affect the value of the Swiss franc in the foreign exchange market. Switzerland's major trading partners include Germany, France, Italy and the United States. While Switzerland still exports large amounts of traditional products such as chocolate and watches, more than half of Swiss exports are in mechanical and electrical engineering and chemicals today. A positive trade balance indicates a trade surplus while a negative balance represents a trade deficit. Trade surpluses indicate that foreigners are buying more Swiss goods, which are typically paid for in Swiss Francs. This translates into greater demand for the currency and upward pressure on the value of the Franc. However, if the balance is a deficit, Swiss consumers are buying goods from trading partners which translates into higher demand for foreign currencies placing downward pressure on the value of the Franc.