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Swiss Economists Cut Growth Forecast as Inflation Expectations Rise for 2026
Admin Economic news
Swiss Economists Cut Growth Forecast as Inflation Expectations Rise for 2026

Swiss economic growth is expected to slow slightly this year, according to the latest KOF Consensus Forecast compiled by the ETH Zurich economic institute. Economists have downgraded growth expectations while also revising inflation forecasts upward.

GDP Growth Forecast Reduced

Economists now expect Switzerland’s real GDP to grow by 0.9% in 2026, down from the previous forecast of 1.0%. The revision signals a slightly weaker economic outlook compared with earlier expectations. The KOF Institute reported that overall economic momentum is weakening, particularly due to reduced expectations for fixed capital investment. However, growth for 2027 remains unchanged at 1.5%, suggesting a gradual recovery in the medium term.

Inflation Forecasts Move Higher

Inflation expectations have been revised upward across the forecast period. Economists now expect inflation to average:

  • 0.7% in 2026
  • 0.8% in 2027

These figures represent an increase of 0.3 and 0.2 percentage points respectively compared with the previous survey. Despite higher inflation expectations, price growth remains relatively moderate by international standards.

Labour Market Stability Continues

The labour market outlook remains steady. Economists continue to forecast an unemployment rate of 3.1% for 2026, unchanged from earlier projections.

This indicates that while growth is slowing, Switzerland’s employment market is expected to remain stable.

Swiss Franc Expected to Stay Strong

The survey also highlights expectations for currency stability and strength:

  • Swiss franc expected to appreciate against the US dollar
  • Expected exchange rate: 0.78 CHF/USD in 3 months
  • Expected exchange rate: 0.76 CHF/USD in 12 months
  • Euro forecast remains stable at around 0.90 CHF/EUR

Analysts suggest the franc will continue to act as a safe-haven currency amid global uncertainty.

Economic Outlook: Cautious but Stable

Overall, the KOF survey indicates a cautious outlook for the Swiss economy. Growth is slowing slightly, inflation is edging higher, but employment and currency stability remain strong. Economists describe the situation as a period of moderate but stable economic performance, rather than a sharp downturn.

Swiss Parliament Approves Pension Boost but Funding Gap Remains
Admin Economic news
Swiss Parliament Approves Pension Boost but Funding Gap Remains

Switzerland’s parliament has approved a partial funding plan for the country’s new 13th annual state pension payment, but a significant financing gap remains unresolved.

After months of political debate, the National Council backed an increase in Value Added Tax (VAT) while rejecting higher payroll contributions. The decision means that only part of the additional pension costs will be covered by dedicated funding.

Under the approved plan, Switzerland’s standard VAT rate will increase from 8.1% to 8.5%. The special VAT rate applied to hotels will rise from 3.8% to 4%. However, the reduced VAT rate of 2.6% on essential goods such as food and medicines will remain unchanged.

The breakthrough came after the Green Liberal Party changed its position and agreed to support a permanent VAT increase. This shift helped secure parliamentary approval for the measure.

Despite the agreement, lawmakers narrowly rejected a proposal to increase payroll contributions by 0.2 percentage points. That proposal had been part of a compromise designed to fully finance the new pension benefit.

As a result, the approved VAT increase is expected to cover only around half of the total cost of the 13th pension payment.

Funding Challenge Still Unresolved

The Swiss Federal Council had previously prepared alternative financing options in case parliament failed to agree on a funding plan. These options included a larger VAT increase or a combination of higher VAT and payroll deductions.

At present, neither of these alternatives appears to have sufficient political support. This leaves the government facing the challenge of finding additional funding sources in the coming years.

Swiss Voters Likely to Decide

The VAT increase is expected to pass parliament’s final approval process. Because it requires a constitutional amendment, the proposal must also be approved by Swiss voters and cantons through a national referendum.

Political observers expect the vote to take place in November.

First Payments Begin This Year

The first 13th pension payments are scheduled to be distributed in December. The program is expected to cost approximately CHF 4.2 billion during its first year alone.

Even if voters approve the VAT increase, implementation will take time because businesses must update systems and pricing structures. As a result, the pension supplement will likely be paid for roughly two years before dedicated funding begins flowing into the system.

Experts estimate that this temporary shortfall could create a funding gap of approximately CHF 9 billion.

Long-Term Pressure on the Pension System

Switzerland’s ageing population continues to place increasing pressure on the state pension system. As the number of retirees grows faster than the working population, pension expenses continue to rise.

While strong financial market performance has helped support pension funds in recent years, economists warn that long-term sustainability remains a major concern.

Without additional reforms, the gap between pension obligations and available funding could continue to widen, increasing future costs for taxpayers and workers.

Switzerland to Raise VAT to Fund 13th Pension Payment
Admin Economic news
Switzerland to Raise VAT to Fund 13th Pension Payment

The Swiss parliament has approved a plan to increase value-added tax (VAT) in order to finance the country’s new 13th old-age pension payment. The decision now moves to the public, as voters and cantons must approve the constitutional amendment in a referendum.

Under the approved proposal, the standard VAT rate will rise by 0.4 percentage points starting in 2028. A reduced increase of 0.2 points will apply to the hotel sector, while essential goods such as food and medicines will remain unchanged under the current reduced rate.

Lawmakers had debated for months over how to fund the additional pension payment. The final compromise rejected a mixed funding model that included payroll deductions and instead relied primarily on VAT adjustments.

The House of Representatives approved the measure by 108 votes to 85, while the Senate backed it by 28 votes to 13. Both chambers ultimately supported the compromise put forward by the Conciliation Committee after prolonged discussions.

The 13th pension benefit, which was approved by Swiss voters in a previous referendum, will be paid out for the first time at the end of the year. The program is expected to cost around CHF 4.2 billion in its first year, with costs rising to CHF 5.4 billion by 2040.

Government officials argue that the VAT increase is necessary to ensure long-term sustainability of the old-age pension system. However, the proposal has sparked debate among social and economic groups.

Employers’ associations and business groups have criticized the decision, warning that a permanent tax increase could negatively affect economic competitiveness. They had preferred a temporary VAT adjustment combined with structural reforms.

On the other hand, employee organizations have expressed concern that the chosen funding method may weaken the financial stability of the pension system. They argue that a more balanced solution had been available during negotiations. The final decision now rests with Swiss voters, who will determine whether the VAT increase should be implemented as part of the country’s pension funding strategy.

Why This Matters:

The outcome will have a direct impact on Switzerland’s tax system, pension sustainability, and overall cost of living. It also reflects the ongoing challenge of balancing social welfare commitments with economic stability.

Swiss Asset Management Industry Becomes Third Largest in Europe
Admin Economic news
Swiss Asset Management Industry Becomes Third Largest in Europe

Switzerland’s asset management industry has reached a new record high in 2025, strengthening its position as the third largest in Europe after the United Kingdom and France.

According to the Asset Management Association Switzerland (AMAS), total assets under administration rose by 8% year-on-year to CHF3.73 trillion (around $4.67 trillion). The growth highlights the continued strength and international relevance of Switzerland’s financial sector.

AMAS director Adrian Schatzmann stated that the industry remains resilient and strategically important for the Swiss financial centre. He emphasized that Switzerland continues to play a key role in global investment flows despite increasing international competition.

A recent study conducted with consulting firm Zeb identifies several key drivers behind the sector’s growth. These include the expansion of private markets, financial innovation, and improved access to international investors.

One notable trend is the increasing role of foreign clients in Switzerland’s asset management industry. According to the report, approximately one-third of all assets under management in the country originate from international investors, underlining Switzerland’s strong global appeal.

Experts suggest that continued innovation and diversification will be essential for maintaining competitiveness in the evolving European financial landscape. The rise of private markets and cross-border investment opportunities is expected to further strengthen Switzerland’s position in the coming years.

With steady growth and strong international participation, Switzerland’s asset management sector continues to solidify its reputation as a leading global financial hub.

Indian Regulator Targets Owner of Swiss Gold Refinery Valcambi
Admin Economic news
Indian Regulator Targets Owner of Swiss Gold Refinery Valcambi

A major financial controversy has emerged involving Rajesh Exports, the Indian company that owns Switzerland-based gold refinery Valcambi. India’s stock market regulator has accused the company of significant accounting irregularities and claims that its turnover may have been overstated by approximately $159 billion (CHF 127 billion) over several years.

In a provisional ruling released on Wednesday, the regulator stated that Rajesh Exports allegedly presented an inflated and misleading picture of its financial strength and business scale. As part of the action, Chief Executive Officer and majority shareholder Rajesh Mehta has been temporarily barred from trading shares of the company until further notice.

The investigation centers on Valcambi, one of the world’s most recognized gold refineries, located in Ticino, Switzerland. Rajesh Exports acquired Valcambi in 2015 for approximately $400 million. According to the regulator, a large portion of the group’s reported revenue originated from foreign subsidiaries, particularly the Swiss refinery.

Authorities criticized the company for failing to disclose important financial information related to Valcambi and several other overseas subsidiaries. Regulators noted that Valcambi’s audited financial statements reportedly showed substantially lower sales figures than those reflected in the group’s consolidated accounts.

The regulator believes these discrepancies may indicate that the overall operational size and turnover of the company were significantly overstated for an extended period. The investigation began in 2024 after a shareholder submitted a formal complaint regarding the company’s financial reporting practices.

Importantly, the ruling does not accuse Valcambi itself of any wrongdoing. The allegations currently focus on Rajesh Exports and its management team. The Swiss refinery has not been directly implicated in the accounting concerns raised by Indian authorities.

The case is expected to attract significant attention from investors, financial regulators, and the global precious metals industry as further details emerge in the coming months.

UBS CEO Sergio Ermotti Dismisses Relocation Rumours, Reaffirms Swiss HQ.
Admin Economic news
UBS CEO Sergio Ermotti Dismisses Relocation Rumours, Reaffirms Swiss HQ.

UBS Chief Executive Officer Sergio Ermotti has reaffirmed the bank’s long-term commitment to Switzerland, dismissing ongoing speculation about a possible relocation of its headquarters.

Speaking amid renewed debate over Swiss banking regulations, Ermotti stressed that UBS remains firmly anchored in Switzerland, despite tensions with the federal government over proposed changes to capital requirements.

The dispute centres on a plan by the Federal Council to require UBS’s foreign subsidiaries to be fully backed by equity capital. The measure is intended to strengthen financial stability and reduce systemic risk in the banking sector.

UBS has opposed the proposal, arguing that stricter capital rules could weaken its global competitiveness and limit its operational flexibility in international markets.

The disagreement has repeatedly triggered speculation that UBS might consider shifting parts of its operations abroad. However, Ermotti has consistently rejected such rumours, emphasizing that Switzerland remains the bank’s strategic and operational base.

The Swiss government maintains that stronger capital buffers are necessary given UBS’s size and global exposure, particularly following its takeover of Credit Suisse, which significantly expanded its balance sheet.

Despite regulatory tensions, UBS leadership continues to highlight the importance of Switzerland as a stable financial hub and key location for global banking operations.

The latest remarks from Ermotti aim to reassure markets and policymakers that UBS intends to maintain its headquarters in Switzerland while continuing discussions with regulators on future capital rules.

Swiss Regulator Finds Gaps in Banks’ Money Laundering Risk Analysis.
Admin Economic news
Swiss Regulator Finds Gaps in Banks’ Money Laundering Risk Analysis.

Switzerland’s financial regulator FINMA has found that while banks and other financial institutions have strengthened their anti-money laundering (AML) measures, significant weaknesses remain in how they assess and manage risk.

In a report published on Thursday, FINMA stated that Swiss banks, asset managers, and other financial institutions are still not consistently applying robust risk analysis frameworks. The regulator emphasized that institutions must make better use of existing tools to identify and monitor high-risk financial activity.

Following a review process launched after investigations in 2023, FINMA examined the risk assessments of more than 30 banks and conducted additional supervisory checks across the financial sector. The findings revealed recurring shortcomings in how risks are recorded and evaluated.

According to FINMA, some institutions failed to document risks in sufficient detail, while internal control exceptions were applied too broadly. In addition, warning indicators designed to detect suspicious activity were often too weak or not clearly defined, increasing the chance that problematic client relationships could go unnoticed.

The regulator highlighted particular concerns around politically exposed persons (PEPs), complex corporate structures, and the growing use of crypto-related financial services. These areas, FINMA warned, require enhanced scrutiny due to their higher exposure to money laundering risks.

Although Switzerland’s financial sector has made progress in strengthening compliance systems, FINMA stressed that further improvements are necessary to ensure effective risk detection and prevention. The authority called on institutions to tighten internal controls and improve the quality of their monitoring processes.

The report reinforces Switzerland’s ongoing efforts to maintain the integrity of its banking system while adapting to increasingly complex global financial risks.

Swiss Economy Grows Slower Than Expected in Early 2026.
Admin Economic news
Swiss Economy Grows Slower Than Expected in Early 2026.

Switzerland’s economy recorded moderate growth during the first quarter of 2026, according to the latest figures released by the State Secretariat for Economic Affairs (SECO). The country’s real Gross Domestic Product (GDP) increased by 0.4% compared with the previous quarter after seasonal and special-event adjustments.

The result came in slightly below SECO’s preliminary forecast of 0.5% issued earlier this month. Despite the small downgrade, the latest figure still represents an improvement compared with the previous two quarters, which recorded growth rates of 0.2% and -0.4% respectively.

The main driver of economic expansion was Switzerland’s industrial sector. Industrial value added increased by a strong 1.3%, marking one of the sector’s best performances in recent quarters after a prolonged period of modest growth.

In contrast, the service sector showed only limited momentum. Growth in services reached just 0.2%, with several industries reporting mixed results. Retail and trade activities experienced declines, reflecting cautious consumer behavior and weaker domestic spending.

Private consumption remained largely stagnant, contributing to weak domestic demand. Overall domestic final demand rose by only 0.1%. Government expenditure helped support economic activity, increasing by 0.9% during the quarter.

SECO noted that Swiss GDP figures are adjusted to remove the impact of major international sporting events. Organizations such as the International Olympic Committee and several global sports federations are based in Switzerland, and their licensing revenues can significantly influence economic statistics. Without these adjustments, first-quarter GDP growth would have reached 0.7%.

While growth remains positive, the latest figures suggest that Switzerland’s economic recovery continues at a measured pace. Strong industrial performance is helping to offset weaker consumer spending, but economists will continue to monitor domestic demand and global economic conditions closely in the coming months.

The latest data indicate that Switzerland remains on a stable economic path, though challenges linked to consumer confidence and international market uncertainties continue to influence growth prospects.

Google Engineer Charged Over Polymarket Bets.
Admin Technology
Google Engineer Charged Over Polymarket Bets.

US federal prosecutors have charged a Google software engineer with allegedly using confidential company data to make more than $1.2 million through prediction market bets on Polymarket.

According to the US Department of Justice, Michele Spagnuolo allegedly accessed internal Google search trend information before it became public and used the data to place profitable bets under the online alias “AlphaRaccoon.”

Prosecutors say Spagnuolo used insider knowledge connected to Google’s annual “Year in Search” rankings. Authorities claim he placed high-risk bets on unexpected names, including musician D4vd and rapper Kendrick Lamar, before official search trend results were released.

The US Department of Justice charged him with commodities fraud, wire fraud, and money laundering. Officials say insider trading threatens the integrity of emerging prediction markets and financial systems.

The case highlights growing concerns surrounding the rapid expansion of prediction market platforms like Polymarket. Regulators increasingly worry that confidential information could be exploited for gambling-style financial gains.

Google confirmed that using confidential internal data for betting violates company policy and stated that the employee has been placed on leave while investigations continue.

The complaint also states that Spagnuolo currently resides in Switzerland, adding international attention to the case. Federal prosecutors in New York say they will continue targeting corporate insiders who misuse sensitive information for personal profit.

Former Raiffeisen CEO Faces CHF1 Million Tax Penalty.
Admin Swiss news
Former Raiffeisen CEO Faces CHF1 Million Tax Penalty.

Former Raiffeisen Switzerland CEO Pierin Vincenz has reportedly been ordered to pay nearly CHF1 million in fines linked to tax evasion, according to reports published by Swiss newspaper SonntagsZeitung.

The report states that the Swiss Federal Supreme Court confirmed the sentence in a judgment that recently became legally binding. Swiss tax-related court proceedings are generally not public, which is why the case had remained largely unknown until now.

Authorities allege that Vincenz failed to declare approximately CHF3.4 million in taxable income. In addition to the financial penalty, he could also be required to pay significant backdated taxes.

During the proceedings, Vincenz denied the allegations against him.

The investigation reportedly began after tax authorities in Appenzell Ausserrhoden reviewed a criminal indictment connected to an ongoing case in Zurich and identified suspicious financial transactions.

In 2022, Vincenz and several associates were found guilty of fraud and embezzlement in a separate criminal case involving acquisitions made during his leadership at Raiffeisen. However, appeals against those convictions are still ongoing.

A February 2025 ruling by Switzerland’s highest court reportedly upheld parts of the earlier legal findings, making the latest tax penalty enforceable.

Vincenz continues to face legal scrutiny over accusations that he personally benefited from business deals conducted while serving as chief executive of Raiffeisen. Another appeal hearing in the broader case is expected to take place in August.

The case remains one of the most closely followed financial and corporate governance scandals in modern Swiss banking history.