May 30 2023

Gross domestic product in the first quarter of 2023: Swiss economy grows


Switzerland's GDP adjusted for sporting events rose by 0.5% in the first quarter of 2023, following 0.0% growth in the fourth quarter of 2022. Domestic demand proved robust. Along with rising goods exports, manufacturing also registered a slight increase.

Growth in domestic final demand (+0.9%) was stronger in the first quarter than the historical average. Government consumption (+0.0%) stagnated, but private consumption (+0.6%) recorded substantial growth. In particular, there was a significant increase in consumer spending on services, such as mobility and tourism. Buoyed by the continued recovery in travel, value added in the transport and communication sector (+0.7%) and in the accommodation and food services sector (+1.0%) increased at an above-average rate.

Consumer spending on goods developed at a more moderate pace. Value added in retail trade (−0.4%) slightly declined accordingly, albeit from a high level. Bolstered by wholesale trade and car sales, trade as a whole (+2.1%) nonetheless posted a positive overall result for the quarter. Most other service sectors also registered positive growth in the first quarter, including the important sector of business-related services (+0.2%), the health sector (+0.7%) and the entertainment sector (+1.2%).

Investment activity also contributed to the solid development of domestic demand in the first quarter. Investments in equipment (+2.6%) saw a significant rise. This was mainly attributa-ble to research and development and to vehicles, but the other categories also saw slight growth overall. Construction investment (–0.1%) was essentially stable. After a number of weak quarters, value added in the construction sector (+0.8%) rose again, driven mainly by higher sales revenues in civil engineering and specialised construction activities.

Following three negative quarters in succession, value added in the manufacturing sector (+0.3%) again posted a slight uptick. The chemical and pharmaceutical industry declined at a high level (–0.6%). Value added increased in the other industrial sectors, however, with higher exports and sales in machinery and vehicles, for example. Exports of goods*** saw broad-based growth overall across the various categories and markets (+4.0%).

On the other hand, exports of services (–0.9%) posted a decline. With exports of financial services contracting, value added in the financial sector (–4.1%) also fell noticeably, as in previous quarters. Meanwhile, there was an increase in imports of goods and services (+3.6%). Overall, the contribution of foreign trade to GDP growth was slightly negative.