Economy OECD raises growth forecast for Swiss economy slightly

According to the OECD economic organization, the Swiss economy is growing slightly faster than previously expected. However, it is not expected to gain momentum until the year after next.

For the coming year 2025, the Organization for Economic Cooperation and Development (OECD) is forecasting gross domestic product (GDP) growth of 1.5 percent, as it wrote in its "Economic Outlook" on Wednesday. Previously, it had assumed growth of 1.4 percent. According to the forecast, GDP growth is likely to reach 1.3% in 2024 (previously +1.1%).

According to its new forecast, the OECD then expects a somewhat more significant acceleration in 2026, for which it predicts GDP growth of 1.9%.

Consumption helps

The growth of the Swiss economy will be driven by a recovery in private consumption and rising employment. Falling inflation and better financing conditions should also help. In terms of inflation, the OECD expects an inflation rate of 1.1% in the current year and 0.9% and 1.0% in 2025 and 2026 respectively.

Among the risks to the forecast, the OECD economists cite worse than expected development, particularly in Germany, but also in the USA and China. They also emphasize that the banking sector is susceptible to international economic downturns. The conditions on the global financial markets had a particular impact on the wealth management business for private and institutional clients.

Challenges posed by demographics

According to the organization's experts, Switzerland needs structural reforms in the long term. This is because there are demographic challenges. Possible measures include an automatic adjustment of the retirement age in line with rising life expectancy and stronger incentives for later retirement.

According to the OECD, Switzerland should also accelerate adjustments to meet climate targets, particularly through a faster transition to emission-free energy sources in the transportation and construction sectors. Switzerland could also make further progress in productivity by promoting the digital transformation, the report continues.

SDA