The drop everyone was hoping for

We’ve been talking for some months now about the possibility of interest rates falling in 2024, and now it’s already here in our country. Analysts are calling this drop, however modest, significant, as it heralds a change in economic trends. What we’ll have to watch over the next few days is the reaction of mortgage financing players, to see if they pass on this event to the borrowing rates offered to individuals.

The result of controlled inflation

The SNB’s decision was made possible by the resilience of our domestic market to inflation. Indeed, the measures adopted for almost two and a half years now have proved effective in curbing the price rises that have hit harder elsewhere. Inflation here has remained below 2%, which the Federal Banker describes as price stability. This decline has also been observed in other parts of the world, giving grounds for optimism.

No crisis, but sluggish growth.

With geopolitical tensions showing no signs of abating, the economy seems reluctant to take off again. No one knows today what tomorrow will bring, or how much longer the instability prevailing in various corners of the globe will last. In Switzerland, no recession is in sight, but forecasters are very cautious about the level of growth in 2024. It’s true that our GDP grew last year, but only at a fairly moderate pace. While the service sector performed relatively well, the value created by industry stagnated. So, barring a rapid resolution of the sources of international uncertainty, our growth is likely to remain at around 1% this year.