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Swiss Government Raises 2012 Growth Forecast on Spending

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Swiss Government Raises 2012 Growth Forecast
Pedestrians pass the window display of a Victorinox AG Swiss army pocket knife store in Geneva. Household spending will rise 1.7 percent this year and 1.3 percent in 2013 instead of a previously projected 1.2 percent and 1.6 percent, today’s statement showed. Photographer: Valentin Flauraud/Bloomberg

June 12 (Bloomberg) -- The Swiss government’s expert group raised its growth forecast for this year on domestic demand.

Swiss gross domestic product will rise 1.4 percent this year instead of a previously projected 0.8 percent, the State Secretariat for Economic Affairs in Bern said in an e-mailed statement today. In 2013, the economy may expand 1.5 percent, compared with a March forecast of 1.8 percent.

Switzerland’s economic recovery is showing signs of gaining momentum after growth unexpectedly accelerated in the first quarter. The KOF leading indicator increased for a fourth month in May, consumer confidence rose to the highest in a year in April, and Burckhardt Compression Holding AG, which sells compressors to companies including Royal Dutch Shell Plc, said on June 5 new order growth may exceed 10 percent this year.

“This adjustment cannot detract from he fact that the economic environment in Europe has recently deteriorated further,” the state secretariat said in the statement. “The economic dynamic is expected to remain relatively weak. Preventing an escalation of the sovereign debt crisis in the euro region is the key prerequisite for a continuation of the positive economic development.”

Household spending will rise 1.7 percent this year and 1.3 percent in 2013 instead of a previously projected 1.2 percent and 1.6 percent, today’s statement showed. Investment in equipment and software may rise 0.5 percent in 2012 instead of declining 2 percent as previously forecast, while exports are seen advancing 1.4 percent and 4 percent this year and next, respectively.

The government’s expert group publishes quarterly forecasts for the Swiss economy.

To contact the reporter on this story: Corinne Gretler in Zurich at cgretler1@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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