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Global markets opened the week cautiously, with Wall Street's tech stocks driving gains amid mixed sentiment. Investors are anticipating a 25 basis point rate cut from the Federal Reserve, supported by a strong US jobs report, while central bank meetings and US CPI data will be pivotal for future rate expectations. The US dollar found support at the 105.13 trendline, while the EUR/USD faces risks ahead of the ECB meeting, and the Japan 225 index shows potential for gains amid economic resilience.
Switzerland is set to release a pivotal report on the causes of Credit Suisse's 2023 collapse, with implications for UBS Group AG's future regulation. The parliamentary investigation commission (PUK) has questioned over 60 individuals and aims to finalize its findings by year-end, influencing legislative changes and capital requirements for UBS. The report could significantly shape public opinion and accountability, reminiscent of past inquiries that have impacted political careers.
Switzerland's deposit protection scheme, officially guaranteeing up to 100,000 francs, was severely underfunded, with only 6 billion francs available. Despite multiple warnings about the risks posed by major banks, regulatory measures were weakened, leading to a crisis where Credit Suisse faced a bank run, necessitating a 250 billion franc government and SNB intervention for its takeover by UBS.
Raiffeisen Switzerland forecasts a slight economic growth improvement for 2024 and 2025, with GDP expected to rise by 1.1% and 1.3%, respectively. However, uncertainties from U.S. trade policy and political instability in Germany and France may hinder Switzerland's economic potential. Interest rates are anticipated to decline further, with a possible drop to 0.75%, while the real estate market may see renewed interest from institutional investors despite not returning to pre-2020 boom levels.
Raiffeisen economists project a slight economic recovery for Switzerland in 2025, with GDP growth expected at 1.3%, up from 1.1% this year. However, uncertainties from US trade policy and political instability in Germany and France pose risks, while the chemicals and pharmaceuticals sector shows resilience. Interest rates are anticipated to fall further, potentially approaching zero, impacting financing and the real estate market.
Raiffeisen Switzerland forecasts a slight economic growth of 1.1% for 2024 and 1.3% for 2025, despite uncertainties from U.S. trade policies and political instability in Germany and France impacting demand. The Swiss National Bank is expected to lower interest rates further, with a potential approach to zero or negative rates by 2026.
Raiffeisen economists project a slight economic recovery for Switzerland in 2025, with GDP growth expected at 1.3%, up from 1.1% this year. However, uncertainties from US trade policy and political instability in Germany and France pose risks, while inflation is anticipated to drop to 0.5%. Interest rates may continue to decline, potentially approaching zero, impacting financing and the real estate market.
Swiss inflation rose to 0.7% in November, slightly up from 0.6% in October, driven by higher rents and clothing prices. The Swiss National Bank is expected to cut interest rates again on December 12, as inflation remains within its 0-2% target range, with further cuts anticipated by March. Economic concerns, particularly regarding Germany, and a strong franc contribute to the case for these rate reductions.
Rents in Switzerland will not decrease yet, as the benchmark mortgage rate remains at 1.75 percent, according to the Federal Office for Housing. Despite recent reductions in the Swiss National Bank's guide rate, experts anticipate a potential drop to 1.5 percent by March, which could allow tenants to apply for lower rents.
Switzerland is experiencing economic challenges due to a slowdown in Germany, its primary trading partner, according to Swiss National Bank President Martin Schlegel. He noted that the decline in German industrial demand is significantly impacting Swiss industries, likening the situation to Germany having a cold while Switzerland suffers from the flu.
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The information provided herein is generated by experimental artificial intelligence and is for informational purposes only.
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