Swiss economy returns to growth in fourth quarter

ZURICH, Feb 27 (Reuters) - Switzerland's economy returned to growth in the fourth quarter, the government said on Friday, confirming preliminary data published earlier this month, as the country recovered from the shock of high U.S. tariffs imposed earlier in the year.

Export-orientated Switzerland was left in a state of shock in August when President Donald Trump imposed duties of 39% on Swiss exports to the United States.

The charge hobbled Swiss exports of watches and machinery to one of their biggest markets, leading to a 0.4% drop in Swiss economic output during the third quarter.

But the Swiss economy rebounded to grow by 0.2% adjusted for sports events in the fourth quarter, helped by a framework agreement to reduce the tariffs to 15% that was agreed in mid-November.

Robust internal demand was the main driver, driven by consumer spending and investments by companies and the public sector.

"This stabilised overall economic development at the end of the year," said the State Secretariat for Economic Affairs (SECO), which compiles the data.

"Economic activity was supported by domestic demand. In contrast, foreign trade slowed GDP growth, as exports grew at a below-average rate while imports rose significantly," it added.

The upturn meant that according to provisional results, the Swiss economy grew by 1.4% adjusted for sports events in 2025, SECO said, up from 1.2% in 2024.

The figure was boosted by a strong first quarter, when companies increased their output and shipments to the United States to avoid tariffs before they were imposed, as well as internal demand supported by low unemployment and rising wages in Switzerland.