IMF ends 2026 consultation with Switzerland, flags external risks
The IMF Executive Board completed its 2026 Article IV consultation with Switzerland, saying the economy has been resilient but growth is seen softening in 2026 amid geopolitical uncertainty and weaker global demand.
Story updates
The Swiss economy has demonstrated resilience amid heightened global uncertainty and global energy price shock, benefiting from strong policy frameworks and economic flexibility.
Fiscal and monetary policies are cyclically appropriate but will need to remain nimble.
Proposed Too-Big-To-Fail (TBTF) reforms are essential to maintaining financial stability.
Rising medium- to long-term fiscal pressures from ageing, defence, and climate should be managed within the debt-brake framework, and structural reforms are key to enhancing productivity.
Washington, DC September 1, 2026: The Executive Board of the International Monetary Fund (IMF) completed the Article IV Consultation for Switzerland[1] and considered and endorsed the staff appraisal without a meeting on a lapse of time basis on August 25, 2026.[2] The authorities have consented to the publication of the Staff Report prepared for this consultation.[3] The economy has navigated global volatility well.
Growth (adjusted for sporting events) was strong at 1.5 percent (1.4 percent without adjustments) in 2025 but appears to be softening in 2026 amid geopolitical uncertainty and weaker global growth.
The impact of global energy price shock has been milder in Switzerland.
After declining to 0.2 percent in 2025, driven by franc appreciation, falling energy prices, and moderating rents, inflation has picked up.
Higher energy prices pushed headline inflation to 0.5 percent in June 2026, while core inflation remained subdued at 0.3 percent.
A modest fiscal expansion is underway due to the additional pension benefits, while the monetary policy stance remains unchanged since last year.
Growth (adjusted for sporting events) is expected to moderate to 0.8 percent (1.1 percent without adjustments) in 2026, supported by accommodative monetary policy and real wage growth despite sluggish external demand.
Growth will accelerate during 2027-28 before stabilizing at its potential rate (1.5 percent) thereafter.
Inflation is projected to pick up to 0.6 percent in 2026, driven by higher global inflation and energy prices, and will remain low at 0.7 percent, within the SNB s price stability range, over the medium term.
Current account surpluses will remain large.
Risks to the outlook are mainly external and tilted to the downside.
The situation in the Middle East has improved lately but remains fragile.
Elevated geopolitical tensions and a rebound in energy prices could dampen growth, while additional US tariffs as a result of ongoing investigations could weigh on exports.
Entrenched trade barriers and fragmentation could undermine long-term potential by disrupting multinational supply chains and weakening the export-oriented, high-productivity growth model.
On the upside, lower energy prices and easing geopolitical tensions would bolster growth.
Continue Reading Here