Consumers were marginally more pessimistic in July than in June, as seen with the consumer confidence index slipping to minus 33 from minus 32, but still above the long-term average of minus 38.

They soured on their previous financial situation, the index falling to minus 41 in July from minus 36 the previous month, with the outlook also deteriorating to minus 28 from minus 27.

Swiss consumers are still a bit cautious on whether now is a good time to make major purchases, with the reading at minus 26 from minus 27 in June. However, their future expectations for making a big ticket purchase improved to minus 51 in July from minus 56 the previous month, improving to the best reading since December of last year and showing pent-up demand.

Consumers remain unconcerned about inflation, both past and present, which is also borne out by the recent inflation results for July as consumer prices were unchanged on the month and up only 0.2 percent from their year-ago levels.

As of yesterday, Switzerland faces 39 percent tariffs on goods it sends to the US, while European products have only 15 percent tariffs, making Swiss products far less attractive on a pricing basis. As of now, consumer confidence is holding relatively steady, but this could be undermined as the effects of the tariffs slither their way through the economy.

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.

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.