(MENAFN- Swissinfo) Switzerland's economy expanded 0.1% in the second quarter, a sharp slowdown from the first three months of the year, when pharmaceutical companies accelerated exports in case US President Donald Trump hit the sector with tariffs. This content was published on August 15, 2025 - 16:38 3 minutes Olaf Storbeck in Frankfurt, Financial Times

Friday's quarter-on-quarter GDP flash estimate for the April to June period was better than the 0.1% contraction forecast by economists in a Bloomberg poll.

Nevertheless, it will add to the pressure on the Swiss central bank to potentially lower interest rates into negative territory to stimulate economic activity.

“Luck is running out for the Swiss economy,” Melanie Debono, an economist at advisory firm Pantheon Macroeconomics, wrote in a note to clients.

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The second half of the year“will be ugly”, Debono warned, as Switzerland could plunge into a“short shallow recession” following Trump's imposition earlier this month of a 39% tariff on most Swiss goods - the highest level for any developed country.

The“reciprocal” duty level came as a shock to Switzerland, sparking criticism of the way Swiss President Karin Keller-Sutter handled negotiations.

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