Swiss Inflation Rate Rises to 12-Year High

Swiss inflation unexpectedly accelerated to the fastest pace in more than 12 years in December, led by higher energy costs., Bloomberg 1/4/2008 7:08:29 AM

Consumer prices increased 2 percent from a year earlier after rising 1.8 percent in November, the Federal Statistics Office in Neuchatel said today. That's the highest rate since October 1995. Economists forecast it would be unchanged, according to the median of 14 estimates in a Bloomberg News survey.

A surge in oil prices to a record $100.09 a barrel yesterday is pushing up inflation just as a drop in the franc makes imports more expensive. Switzerland's central bank said last month it expects slowing economic growth to help curb price increases. The Swiss National Bank kept its key rate unchanged for the first time in two years last month at 2.75 percent.

From the previous month, consumer prices rose 0.2 percent. Core inflation excluding volatile costs such as food, beverages, tobacco and oil rose 0.9 percent in the year.

In 2007, consumer prices rose 0.7 percent on average, the statistics office said today. Inflation may average 1.7 percent this year and 1.5 percent in 2009 before reaching 1.6 percent by the third quarter of 2010, the SNB said. By comparison, inflation in the economy of the 13 euro nations held at 3.1 percent in December, the European Union's statistics office said today.

Swiss Inflation Rate Rises to 12-Year High