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Investing.com - UBS expects the Swiss economy to grow by approximately 1% in 2026, with private consumption remaining the main pillar of support for economic expansion, according to a report released by the bank on Wednesday.
The Swiss banking giant warned that a potential deterioration in the labor market next year poses a downside risk to its economic outlook, which could undermine consumer spending power despite the projected growth.
UBS anticipates limited impetus from foreign trade in 2026, noting that export growth will likely be constrained by U.S. tariffs while simultaneously receiving some support from an improved German economy. The bank emphasized that external economic uncertainty will remain high throughout next year.
Inflation in Switzerland is expected to remain at a low level of around 0.5% in 2026, according to the UBS forecast. The bank cited lower electricity prices and declines in the reference interest rate as factors that will weigh on consumer prices.
The report indicated that a projected 1% increase in nominal wages for 2026 should help limit potential deflation risks in Switzerland, creating a balance between downward price pressures and modest wage growth in the coming year.
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