Switzerland’s seasonally-adjusted Unemployment Rate is expected to rise to 4.2% in October, the highest in over 11 years. More of the same is likely going forward, with a survey of economists conducted by Bloomberg calling for the jobless rate to average at 5% next year, while the government’s outlook is an even more pessimistic 5.2%. Continued job losses are likely to trim incomes and discourage spending, weighing on the pace of overall economic growth. Total output likely contracted for the fourth consecutive quarter in the three months to September and is not expected to return to show even modest positive growth until early 2010. Combined with the eighth consecutive month of shrinking consumer prices in October, markets are set to see the SNB remain firmly on hold and likely to intervene against the Franc any time the EURCHF exchange rate nears 1.50.
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