Swiss UBS consumption rises without exciting

A measure of Swiss household spending trends rose modestly in May, after the reading for the previous month was revised down sharply, suggesting slightly below-average growth in private consumption during the second quarter, survey data from the UBS investment bank showed Wednesday.

The UBS consumption indicator climbed to 1.39 points from 1.34 in April, which was revised from 1.48. This matches the UBS CIO consumption growth forecast of 1.3 percent for this year, the bank said.

Data published in June regarding new car registrations and hotel overnight stays by Swiss residents was robust and supported the consumption indicator, the UBS said.

As the actual realized growth in employment during the last quarter was weaker than predicted, the April reading was revised downwards and consequently changed momentum of the indicator.

Despite this downward revision in the consumption indicator, the high-frequency data is in no way indicative of weak consumption, the UBS said.

"Consumption is likely to benefit from rising employment as well as a drop in unemployment as the year progresses," the bank said. "The increase in consumer prices will exert a braking effect, however, as rising inflation will lead to lower growth in real income."