The case

Switzerland’s economy is expected to continue to expand below its long-term potential, due to persistent geopolitical uncertainty weighing on the economic outlook.

Source: economiesuisse

The commentary

Despite this challenging environment, Switzerland’s export sector has proven resilient, while domestically focussed industries continue to perform steadily.

Inflation is forecast to reach 0.8 % in 2026. According to economiesuisse, Switzerland’s real gross domestic product (GDP) is expected to grow by 1.0 % in 2026, followed by a modest acceleration to 1.2 % in 2027. The rate of unemployment is projected to edge up slightly from an average of 3.1 % in 2026 to 3.2 % in 2027.

Geopolitical tensions and the uncertainty they create remain the most significant risks to economic growth. Such uncertainty could dampen global demand and, in turn, negatively affect Switzerland’s export-oriented economy. Approximately 60 % of survey respondents identified geopolitical risks and their economic repercussions as the primary threats to future growth.

Beyond geopolitical concerns, respondents also pointed to regulatory burdens (16 %) and political developments (8 %) as notable risks. Furthermore, representatives of the Swiss industry highlighted rising raw material prices (12 %) and broader cost pressures (7 %) as additional downside risks that could constrain economic performance in the coming years.