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Bern Skyline, taken from Rosengarten at the sunrise in Switzerland. Church Center: Nydeggkirche Cathedral Right: Berner Munster Bridge: Nydeggbrücke
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Switzerland is struggling to conclude a trade business with Washington, as it seems to avoid a “triple blow” of economic problems after 39% of the tariffs on the goods imported to the US
This week, Swiss leaders went to Washington, trying to make a deal with the US administration, trying to avoid great responsibilities that will come into force on August 7.
The 39% tariff rate, which is one of the highest in the last shrink new duties of US President Donald Trump, took place as surprise In the European country, as a trade agreement, it would seem inevitable.
On Tuesday, Trump said CNBC that Switzerland’s President Karin Keller “did not want to listen” to his concern about the US trade deficit with Switzerland. Following the announcement of 39% tariff rate, the Switzerland government – Note Switzerland maintained a “very constructive position from the very beginning” during “intense” negotiations.
The United States has recorded a $ 38.3 billion trade deficit with Switzerland, and last year, $ 29.7 billion, reports, according to US Trade Representative Service.
The upcoming tariffs are expected not only to suffer from Swiss companies, but also problems with the broader impact on the country’s economy.
The quarterly economic growth remained slightly muted for some time, with the gross domestic product increased by 0.5% in the first quarter of 2025.
Swiss inflation has long been low Turn negative earlier this year. In July, the consumer price index was 0.2% compared to the same month earlier.
As long as pharmaceutical products – which are key Swiss exports – do not affect tariffs, their impact on economic growth may be limited, said CNBC Adrian Produzhon, Europe’s capital economy.
“We believe that the current tariff level is 39%, but when released to pharmaceutical products, in the medium term will reduce GDP by about 0.6%. Although it is substantially, it is not catastrophically, and this is equivalent to only three months of economic growth,” he explained.
However, Trump also told CNBC in an interview on Tuesday, which is characteristic of the sector tariff on pharmaceuticals can reach up to 250% over the next 18 months.
The US duties on pharmaceutical imports will be the main blow for Switzerland, the large center of the global pharmaceutical industry. In 2023The life sector made 38.5% of Swiss exports.
Specific duties “probably” to accept the aggregate impact of tariffs on the US on Switzerland’s GDP to more than 1% and possibly up to 2%, “-said the preteth.
“Pharma is by far the most important export for Switzerland,” said Kepler Cheuvreux in the note on Monday Torsten Sauter. “Switzerland is used here through the US Pharma Reliance, but it must take a close step – one mistake can cause a devastating 39% tariff to its most valuable sector.”
In addition to Trump tariffs, the demand for Swiss Franco also adds to Switzerland’s economic and diplomatic troubles.
Since the beginning of the year, the currency – as a rule, has been considered as an active refuge during the uncertainty and turbulence of the market – gained about 11% to the US dollar. Him Increasing value weighs inflation that pushed the Swiss National Bank to Reduce its key interest rate to 0% in June.
Swiss Frank/US Dollar
Swiss exporters are now faced with a “triple blow”, said Kepler Chevre on Monday.
“The steep tariffs … (b) go out to the top of the US/CHF currency pair and a competitive deficiency compared to neighboring countries,” he explained.
Recently European Union secured a deal with Trump administration This will see the tariff by 15%imposed on the goods, exports to the US – a much smaller indicator than Swiss.
Kamal Sharma, a G10 FX strategist at the Bank of America, said on Wednesday CNBC that Trump’s trade policy had put the Swiss National Bank in a “very difficult situation”.
“I think the big problem is that in terms of the rate the market is starting a little more concerned because negative (rates) is what is always on the horizon,” he said. “There is a certain concern that if the US-Swiss transaction remains as it is, it means that it will press SNB for further action.”
In the past, the negative figures have done little to increase inflation and weaken the currencies, as well as it is unlikely to drop, said Sharma.
“The more direct the answer that can accept SNB is to say, look, we need to compensate for this by creating some currency cushioning, and what it does is what it returns to the game. So, the intervention is more likely to be,” the strategist added.
But this is not a simple step for Swiss politicians. SNB intervention on the foreign exchange market has led to Switzerland is indicated by the currency manipulator During the first term of Trump and earlier this year, the country was added to the “Monitoring List” of trading partners whose currency practice and macroeconomic policy deserve close attention. “
Trump’s tariff policy also takes into account any “currency manipulation and trade barriers”. Swiss officials denied allegations of intentionally devaluation of the Swiss Franco against the green appeal.
However, Sharma Boa said SNB would probably be plowing currency intervention, even if it “can even bring the anger of the US administration.”
“In something (they), nothing else will lose … They have to start thinking about the Swiss industry.”