Tag: inflation

Swiss Inflation Holds Steady at Low Level as Franc Concerns Swirl

Posted on by 2026news

Swiss inflation was unchanged in February close to zero, a worry for the country’s central bank after it voiced increased willingness to intervene in foreign-exchange markets to halt recent gains in the franc.

Consumer prices were up 0.1% compared with February last year, the same rise as in January, Switzerland’s statistics agency said Wednesday. Swiss inflation was last negative in May.

The Swiss National Bank has struggled to limit the appreciation of the franc over the last year as investors have sought a safe haven from the upheaval caused by President Trump’s tariff hikes and innovations in foreign policy. The attacks on Iran over the weekend pushed the franc to its highest level against the euro in more than a decade on Monday.

A stronger franc lowers the domestic prices of imported goods, while also damping demand for Swiss goods abroad, which also cools inflation. The Swiss economy barely grew in the second half of last year after a significant rise in U.S. tariffs hit the country’s exports, which include luxury watches and chemicals.

The SNB has an inflation target of more than zero but below 2%. Central bankers fear periods of deflation, in which falling prices lead businesses and households to hold back on spending in anticipation of securing better deals in the future. This then weakens activity and prices in what can become a vicious circle.

The SNB has limited options to halt the appreciation of the franc. The central bank’s key interest rate is already at zero, and Chairman Martin Schlegel has long stressed there is a high bar to lowering the key rate below zero, underlining the negative impact on savers and the country’s banks.

The central bank could also sell francs to weaken the currency, thereby helping to boost the inflation rate.

In an unusual announcement, the SNB said Monday that its willingness to sell francs has increased.

“We are prepared to intervene in the foreign-exchange market to counter a rapid and excessive appreciation of the Swiss franc, which jeopardizes price stability in Switzerland,” the bank said.

The franc fell back slightly against other currencies after the announcement. However, it did little to dent the gain of more than 14% against the dollar in the past year.

“Such a warning from the SNB is rather rare,” Commerzbank analyst Michael Pfister said in a note to clients.

“For the time being, it is likely that officials have ensured the market will only test stronger franc levels very cautiously, even amid rising geopolitical risks,” he added.

The move could put Switzerland in the crosshairs of the U.S. Treasury, which put the Alpine nation on its watch list for currency manipulation.

Switzerland is due to publish its foreign-currency reserves for February on Friday.

The jump in prices of oil and gas prompted by the conflict in the Middle East could stoke an increase in inflation in the months ahead. More than 70% of energy consumed in Switzerland is imported, according to a 2025 study by the Swiss Energy Foundation.

“A stable currency and potentially higher energy prices, at least in the near term, largely eliminate the risk of the Swiss economy slipping into deflation over the coming quarters,” said Ankita Amajuri, Europe economist at Pantheon Macroeconomics in a note.

Imported-product prices were down 1.6% in February compared with the same month of last year, while domestic inflation was 0.6%, Wednesday’s data showed.

https://www.wsj.com/economy/swiss-inflation-holds-steady-at-low-level-as-franc-concerns-swirl-5e362cfa?mod=global_news_article_pos4

Eurozone Jobless Rate Hit New Record Low in January

Posted on by 2026news

The eurozone unemployment rate fell to a new record low in January, as the bloc continued to show resilience in the face of global uncertainty.

Unemployment in the currency area fell to 6.1% from 6.2% in December, the European Union’s statistics agency Eurostat said Wednesday.

“Overall, these are robust data which will add to the looming hawkish shift at the ECB as inflation risks now seem to be shifting to the upside,” said Claus Vistesen, chief eurozone economist at Pantheon Macroeconomics.

Across the bloc’s major economies, the decline was driven mainly by falling joblessness in Spain and Italy, he said.

Excluding Bulgaria, which joined the eurozone at the start of 2026, the unemployment rate stood at 6.2%.

“Falling unemployment in Bulgaria of all places…is now helping eurozone joblessness lower,” Vistesen said.

The currency area’s jobless rate is projected to remain relatively stable this year. However, a prolonged attack on Iran by the U.S. and Israel could eventually feed through to employment, as higher energy prices put pressure on businesses.

The figures follow the publication of S&P Global’s purchasing managers’ eurozone survey in late February, which showed companies are reluctant to hire new employees.

In Germany, the bloc’s largest economy, the number of unemployed people fell to just above 3 million in February, with the adjusted rate remaining at 6.3%.

Copyright ©2026 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Don Nico Forbes is a reporter for Dow Jones Newswires and The Wall Street Journal, covering European economics. He also writes features on sustainable business. Don joined Dow Jones and the Journal as a publishing editor in 2019. He holds degrees from the University of Manchester and Universitat Pompeu Fabra, in Barcelona. https://www.wsj.com/world/europe/eurozone-jobless-rate-hit-new-record-low-in-january-43a06109?mod=global_news_article_pos2

Eurozone Retail Sales Decline Unexpectedly

Posted on by 2026news

Eurozone retail sales fell unexpectedly in January despite a rise in consumer confidence at the start of the year, pointing to fragility in household sentiment even before this week’s surge in energy prices.

Volumes were down 0.1% on month, compared with growth of 0.2% in December, the European Union’s statistics agency said Thursday. A consensus of economists polled by The Wall Street Journal expected a 0.3% rise.

The figure for December was revised up from a 0.5% decline.

The fall in January was driven by lower sales of nonfood products and automotive fuel. Volumes were down 0.9% in Germany, the eurozone’s largest economy, while sales rose in France, Spain and Italy.

This comes despite the bloc showing resilience to rising headwinds at the beginning of 2026. On Wednesday, data showed the eurozone unemployment rate falling to a record low in January. Consumer confidence also picked up in the month, according to figures published last week.

But looking ahead, the outlook is likely to be dragged by rising geopolitical uncertainty and energy prices following U.S. and Israeli strikes on Iran.

“This week’s increase in gas and oil prices may dent confidence a bit and lead to higher household inflation expectations,” said Andrew Kenningham, chief Europe economist at Capital Economics.

Even so, household consumption is expected to rise at a moderate pace this year, he said.

Figures also released Thursday showed the Irish economy contracted much more sharply in the final three months of last year than previously estimated. The country’s statistics agency now calculates that gross domestic product was 3.8% lower than in the third quarter, having previously seen a decline of 0.6%.

That may lead to a reduced estimate for growth in the eurozone as a whole during the period. The European Union’s statistics agency had calculated that the currency area’s economy grew by 0.3%.

While Ireland’s economy experienced a sizable contraction at the end of 2025, it recorded one of the world’s fastest expansions over the year as a whole. The Central Statistics Office said annual GDP was 12.3% higher than in 2024, having previously seen growth of 12.6%, on a surge in exports of weight-loss drugs to the U.S.

Copyright ©2026 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Don Nico Forbes is a reporter for Dow Jones Newswires and The Wall Street Journal, covering European economics. He also writes features on sustainable business. Don joined Dow Jones and the Journal as a publishing editor in 2019. He holds degrees from the University of Manchester and.. https://www.wsj.com/business/retail/eurozone-retail-sales-decline-unexpectedly-f6e3b589?mod=global_news_article_pos1