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Cooler-than-expected Swiss Inflation Holds Steady in May; Unemployment Rises

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Cooler-than-expected Swiss Inflation Holds Steady in May; Unemployment Rises

Switzerland's annual inflation unexpectedly remained at 0.6% in May, while the country's jobless rate marginally ticked up, according to economic data published Thursday.

The annual inflation figure lagged the market forecast of 0.8% but remained at the highest level since December 2024 as lingering tensions in the Middle East continue to prop up energy costs. Similarly, the 0.2% monthly uptick was behind the prior month's and expected 0.3% gain.

According to the country's Federal Statistical Office, the yearly increase was largely due to a spike in housing, energy and transport costs. Meanwhile, the month-over-month result was driven by rising prices in the hotel sector and higher housing rental costs.

Excluding volatile items such as fresh and seasonal products, energy and fuel, annual inflation still stood at 0.3%, unchanged from the previous month. Meanwhile, core inflation moved month over month to 0.1% from zero growth.

Swiss inflation still sits within the 0% to 2% target range of the Swiss National Bank (SNBN.SW), which is scheduled to release a monetary policy update on June 18. During the SNB's March meeting, the policy rate remained unchanged at 0% but the central bank raised its conditional inflation forecast for 2026 to 0.5% from 0.3%.

On the employment front, data from the State Secretariat for Economic Affairs showed that the Swiss seasonally adjusted unemployment rate rose to 3.1% in May from 3% a month earlier. The total number of registered jobless individuals climbed to 144,652, representing a monthly increase of 2,583.

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