Swiss economy grows despite strong franc

"Clouds" restaurant at the Prime Tower office building in Zurich Economists say the Swiss economy's outlook remains challenging

Switzerland's economy recorded surprise growth in the final quarter of 2011, fuelled by exports despite the soaring Swiss franc.

Gross domestic product grew 0.1% in the three-month period, the Swiss State Secretariat for Economic Affairs said.

Economists had expected the economy to shrink because of the spillover from the eurozone debt crisis.

In 2011, Switzerland's economy grew 2.6% - much more than most of its European neighbours.

Exports - excluding precious metals, jewels and arts and antiques - increased by 2.8% in the last quarter of the year.

Gross fixed investments increased by 2.5%, due to investment in equipment and construction.

This was despite the surging value of the Swiss franc against the euro as the currency acted as a haven for investors looking for safety.

"Favourable growth in the fourth quarter must not overshadow the challenging situation Switzerland's economy still faces," said bank analyst Joerg Zeuner.

The strong currency rise in 2011 hit Swiss exporters, making goods more expensive for foreign buyers, and hurting Swiss companies' profits when they repatriated their foreign earnings back home.

The Swiss franc rose 2.7% against the euro last year - trading at one-to-one with the euro last August and causing the central bank to intervene to weaken it.

The currency has risen against the euro for the past four years - including a 19% jump in 2010.

More on This Story

Global Economy

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

Features

  • NS Savannah, 1962Nuclear dream

    The ship that totally failed to change the world


  • Ed Miliband takes a selfie at a Cambridge hairdressersNo more photo ops?

    Why is Ed Miliband drawing attention to his public image?


  • Espresso cup7 days quiz

    Which city serves the strongest cup of coffee?


  • Glasgow 2014 quaichs and medalsQuaich guide

    What do the Scottish gifts given to Games medallists symbolise?


  • Malaysian plane wreckage in UkraineFlight risk

    How odd is it for three planes to crash in eight days?


BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.