| Consensus | Actual | Previous | |
|---|---|---|---|
| Level | -35 | -37 | -37 |
Highlights
Consumer sentiment was unchanged in mid-quarter. At minus 37, November's unadjusted headline index held steady at October's mark, matching a 6-month low and 2 percentage points weaker than the market consensus. However, it was still some 11 points stronger than a year ago and well above its minus 40 long-run average.
The monthly drop was largely due to a markedly worse economic outlook (minus 36 after minus 30). Spending intentions (minus 31 after minus 32) were marginally firmer but, of note for the SNB, 1-year ahead inflation expectations (96 after 99) declined.
Today's report leaves a fairly flat, if not slowly deteriorating, underlying trend in consumer confidence and so supports expectations for a cut in the SNB's policy rate on Thursday. The November update lifts the Swiss RPI to minus 2 but trims the RPI-P to minus 2. Recent overall economic activity is performing much as expected.
The monthly drop was largely due to a markedly worse economic outlook (minus 36 after minus 30). Spending intentions (minus 31 after minus 32) were marginally firmer but, of note for the SNB, 1-year ahead inflation expectations (96 after 99) declined.
Today's report leaves a fairly flat, if not slowly deteriorating, underlying trend in consumer confidence and so supports expectations for a cut in the SNB's policy rate on Thursday. The November update lifts the Swiss RPI to minus 2 but trims the RPI-P to minus 2. Recent overall economic activity is performing much as expected.
Market Consensus Before Announcement
The headline index is seen edging up from minus 37 in October to minus 35.
Definition
The State Secretariat for Economic Affairs (SECO) compiles a quarterly survey of consumer attitudes on present and expected economic and financial conditions. The survey covers around 1,200 Swiss households and results are synthesised into a single summary consumer climate index that attempts to measure consumer sentiment.
Description
The pattern in consumer attitudes and spending is often a major influence on stock and bond markets. For stocks, strong economic growth translates to healthy corporate profits and higher stock prices. For bonds, the focus is whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth. Consumer spending accounts for a major portion of the Swiss economy, so investors want to know what consumers are up to and how they might behave in the near future. The more confident consumers are about the economy and their own personal finances, the more likely they are to spend. An increasing important element of the survey is the question concerning current buying intentions.
