During 2020, average annual inflation was –0.7%, according to Switzerland’s Federal Statistical Office (FSO).
In December 2020, Switzerland’s consumer price index (CPI) fell by 0.1% compared with November 2020. Compared to December 2019, prices in December 2020 were 0.8% lower. Annual inflation reached -0.7% across the full year.
The main drivers of a falling CPI were lower travel prices and fuel costs. The price declines on these items were more significant than rising new car prices and rents, said the FSO. So far the pandemic seems to have pushed up rents and property prices. The prices of local products remained stable, however imported items were 2.9% cheaper. This is partly down to Switzerland’s strong currency. According to the latest Economist Big Mac index, the Swiss franc is the only currency that is overvalued against the US dollar.
Inflation of -0.7% in 2020 more than undid the +0.4% inflation that occurred in 2019 but wasn’t enough to undo the +0.9% inflation experienced in Switzerland in 2018. Since 2015, Switzerland’s CPI has risen by 0.9%.