Swiss KOF raises 2010 GDP f'cast to 2.3 vs 1.7 pct

Published 09/09/2010, 07:34 AM
Updated 09/09/2010, 07:36 AM

* Economists raise 2010 growth fcast to 2.3 pct-KOF survey

* Economists see growth slowing in 2011 to 1.7 pct-survey

ZURICH, Sept 9 (Reuters) - Swiss economists raised their growth forecast for the Alpine economy for 2010 and expect only a moderate slowdown next year despite the surging Swiss franc, a survey published on Thursday by the KOF institute showed.

The 22 economists from Swiss banks, companies and research institutes expected the economy to grow by 2.3 this year compared to their June forecast of 1.7 percent, the KOF Swiss Economic Institute said.

The economists forecast growth of 1.7 percent for 2011, a notch less than in June.

Switzerland is recovering from downturn better than many other countries in Europe, and its economy powered ahead in the second quarter as companies cranked up investment spending.

The government has said it may well revise up its 2010 growth outlook, currently at 1.8 percent. [ID:nLDE6810EM]

But with the franc having risen more than 10 percent against the euro this year, early economic indicators are pointing to a slowdown.

The KOF survey showed that inflation remained a non-issue in Switzerland despite the central bank's ultra-loose monetary policy.

For 2011, the economists surveyed by the KOF expect inflation to rise to 1.0 percent form 0.8 percent in 2010.

The Swiss National Bank, which in June dropped its pledge to intervene in currency markets to cap excessive gains in the currency, will review its current forecast of around 2 percent when it holds its next policy meeting on Sept. 16.

(Reporting by Catherine Bosley; Editing by Ron Askew)

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