Swiss consumer prices extended their longest slump in at least four decades in April.
Prices decreased 0.6 percent from a year earlier after dropping 0.6 percent in March, the Federal Statistics Office in Neuchatel said in an e-mailed statement today. Prices were unchanged in the month. Economists expected an annual decline of 0.5 percent and a monthly increase of 0.1 percent, according to a Bloomberg News survey.
The Swiss National Bank imposed a franc ceiling of 1.20 versus the euro in September 2011 to fight deflation threats. Even so, consumer prices have continued to drop and are now in their 19th straight month of annual declines, the longest stretch since at least 1971, according to data compiled by Bloomberg. The SNB, headed by President Thomas Jordan, forecast consumer prices will fall 0.2 percent in 2013, before rising 0.2 percent in 2014 and 0.7 percent in 2015.
“Today’s Swiss CPI read will undoubtedly be upsetting to the SNB,” said Peter Rosenstreich, the chief currency analyst at Swissquote Bank SA in Geneva. “However, despite continuing deflation in Switzerland and contrary to much market hype we do not believe the central bank has any intention in adjusting its exchange rate policy.”
The cost of Swiss imported consumer goods declined 2.8 percent from a year earlier and were unchanged from March, today’s report showed. Prices of domestic goods climbed 0.1 percent on the year and were unchanged on the month.
Under a European Union harmonized method, Swiss consumer prices fell 0.4 percent from a year earlier and 0.1 percent on a monthly basis.