(Bloomberg) — Swiss inflation slowed more than expected in August, supporting the case for another interest-rate cut.
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Consumer prices rose 1.1% from a year ago, the statistics office said Tuesday. That’s weaker than the 1.2% median estimate in a Bloomberg survey and compares with 1.3% in July.
Costs of transport, heating oil and international package holidays all fell, offsetting higher rents and clothing and footwear prices, according to a statement. The core reading — excluding fresh and seasonal products as well as energy — held at 1.1%.
The Swiss National Bank kicked off monetary easing earlier than global peers and has lowered rates at both of this year’s decisions. It will probably deliver a third reduction when officials meet at the end of this month.
That outlook is supported by slow inflation and a strong Swiss currency. Analysts are particularly wary of a potential boost to the franc when the European Central Bank — which meets twice as often as Swiss policymakers — catches up with SNB rate cuts.
Officials at Switzerland’s central bank predict consumer-price growth will average 1.5% in the third quarter — mainly driven by domestic services. It’s then expected to slow, reaching 1% in 2026.
The country has one of Europe’s lowest inflation rates. Data from the neighboring euro area showed price growth there slowed to a three-year low of 2.2% in August. Based on the European Union’s harmonized measure, the Swiss saw an advance of 1% in the period.
–With assistance from Joel Rinneby and Kristian Siedenburg.
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