Swiss CPI dropped by -0.3% mom in September, falling short of the expected -0.1% mom decline. Core CPI, which excludes fresh and seasonal products as well as energy and fuel, also declined by -0.2% mom. Prices for domestic products fell by -0.2% mom, while prices for imported goods saw a steeper decline of -0.5% mom.
On an annual basis, Swiss CPI growth slowed to 0.8% yoy, down from 1.1% and below expectations of 1.1% yoy. Core inflation eased to 1.0% from 1.1%. Notably, prices for imported goods dropped by -2.7% yoy, down from -1.9% yoy. Domestic product prices remained steady at 2.0% yoy.
The sharper-than-expected slowdown in inflation adds pressure on SNB to consider additional rate cuts. With core inflation and imported goods prices continuing to decline, SNB may need to act to prevent deflationary risks from taking hold in the coming months.
