Swiss Inflation Rises in December


Switzerland still faces deflation risks, lower-than-expected inflation data showed on Thursday, as the economic recovery remained fragile, supporting views the Swiss central bank may stick to its loose policy for some time.

Consumer prices rose 0.3 percent in December from a year ago, their first year-on-year increase since February, the Federal Statistics Office said.

But prices declined 0.2 percent from November as retailers slashed prices for clothes and oil prices fell.

Core inflation -- stripping out volatile components such as prices for energy or food -- eased further 0.5 percent, hitting the lowest level since mid 2007.

To fight the worst recession in decades and combat falling prices, the Swiss National Bank launched unconventional policy tools in March, including ultra-low interest rates, corporate debt purchases and foreign exchange interventions.

The statistics office data showed that consumer prices fell on average 0.5 percent in 2009, posting the first full-year price decline since 1959.


TradingEconomics.com, Reuters
1/7/2010 10:29:19 AM