Economists lower growth forecast for 2025 only slightly

The economists surveyed as part of the KOF Consensus Forecast anticipate average growth in real gross domestic product (GDP) of 1.4 percent in 2025 and 1.6 percent in 2026. The forecast for unadjusted GDP growth is 1.2 percent and 1.8 percent respectively for the coming year, as announced by the Swiss Economic Institute (KOF) on Monday.

This means that the growth prospects for the current year are estimated to be slightly weaker than recently. In the December survey, economists had still expected growth of 1.5 percent after adjustment for sporting events and unadjusted growth of 1.3 percent. Values for 2026 have now been published in the KOF Consensus for the first time.

The main reason for the slightly weaker expected economic development in the current year is the lower expectations for capital investment. The experts anticipate an increase of 1.3 percent in 2025, compared to the 1.8 percent growth forecast in December. The trend in equipment investment in particular is likely to weaken, while the figures for construction investment have only been lowered slightly.

Inflation expected to remain low

With regard to the development of inflation, the respondents continue to expect low values. The expected inflation rate for the current year fell by 0.1 percentage points to 0.5%, while inflation of 0.8% is forecast for 2026.

The long-term inflation expectations of the KOF Consensus remain unchanged at +1.0%, with long-term GDP growth of 1.7% (unadjusted).

The outlook for the future situation on the Swiss labor market has deteriorated slightly. The consensus value for the unemployment rate for 2025 is now 2.8%, compared to 2.7% in the December survey. A rate of 2.8% is also expected for 2026 and in the long term.

14 economists took part in the KOF Consensus Forecast. The survey was conducted from February 27 to March 19, 2025.