New cars and hotels helped UBS consumption indicator in August

Switzerland's consumption improved in August thanks to robust new car registrations and encouraging numbers of hotel stays, data from the UBS investment bank showed Wednesday.

The consumption indicator rose to 1.53 points in August from revised 1.46 in July. The index suggested that consumption growth was slightly above the long-term average of 1.5%. The consumption indicator was altered after the Federal Statistical Office revised consumption figures for previous years in late August. 

Nonetheless, UBS economists projected 1.3% increase in consumer spending for the whole year due to weak employment growth in the first half of 2017 and the rise in inflation.

New car registrations in August boosted the UBS consumption indicator. August saw nearly 6% more new car registrations than the same month last year. The upward trend in overnight hotel stays by Swiss residents also helped. Overnight stays in July increased nearly 3% compared to July 2016. Overnight stays from January to July increased by almost 4% compared with the same period last year. Weak employment growth is still affecting the consumption indicator. In the second quarter, employment increased only 0.2%, well below the 1% average since 2000, the bank said.