Swiss con­sumer prices fall most since 1959

The Pak Banker - - BUSINESS -

ZURICH: Swiss con­sumer prices fell year-on-year in July for the ninth month in a row, high­light­ing de­fla­tion­ary pres­sure since the Swiss franc soared against the euro af­ter the cen­tral bank re­moved a cap on the franc's value. Con­sumer prices dropped 1.3 per cent from July 2014, the Fed­eral Sta­tis­tics Of­fice said on Tues­day, more than the 1.0 per cent they fell in June and the av­er­age forecast of a 1.1 per cent drop in a Reuters poll of econ­o­mists. It was the steep­est year-on-year drop since 1959.

Prices fell 0.6 per cent on a monthly ba­sis, com­pared with a 0.4 per cent drop forecast in the Reuters poll. Prices had risen 0.1 per cent on the month in June. The monthly de­crease was mainly due to lower prices for cloth­ing and new cars, the sta­tis­tics of­fice said. Heat­ing oil and ho­tel stays were also cheaper. Petrol prices rose. The Swiss Na­tional Bank abruptly re­moved its cap on the franc - set at 1.20 per euro - on Jan­uary 15. The franc's sub­se­quent surge has low­ered the price of im­ports into Switzer­land from the Eu­ro­zone. The euro was trad­ing around 1.0642 francs shortly af­ter the price data. The cen­tral bank has said it ex­pects prices to fall this year and in 2016.

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