Swiss jobless rate remains unchanged in Sep; SNB likely to maintain weaker currency over medium term

The unemployment rate in Switzerland remained unchanged during the month of September, although there was a small increase in the unadjusted total number of unemployed on the month. Moreover, latest data will tend to reduce fears concerning the economy, although data will continue to be monitored closely by the Swiss National Bank (SNB) with the bank still calling for a weaker currency over the medium term.

The headline Swiss unemployment rate was unchanged at 3.2 percent for September, while the seasonally-adjusted rate was also unchanged at 3.3 percent compared with market expectations of an increase to 3.4 percent, data released by the country’s statistics agency SECO showed Monday.

On an annual basis, there was a small decline in unemployment from 3.4 percent as overall fluctuations remained relatively low. There was a decline in youth unemployment on the month, while there was an increase in the number of job seekers with employees returning to the workforce.

There was an increase in the number of vacancies compared with the previous month and there was also a decline in the amount of short-term working. Although Swiss GDP growth has been solid during 2016, there has been little overall change in the unemployment rate. With a strong currency, there is further underlying pressure on companies to cut costs and reduced payrolls to maintain their competitive position.

The latest data will tend to reduce these fears slightly, although data will continue to be monitored closely by the National Bank with the bank still calling for a weaker currency over the medium term. The overall market impact was limited as EUR/CHF held just below 1.0950 with USD/CHF trading just below 0.9800.