FX.co ★ Swiss Q3 GDP Hits First Contraction Since 2023

Switzerland experienced a 0.5% decline in its economy during the third quarter of 2025, as compared to the previous quarter, according to preliminary data. This downturn contrasts with the modest 0.1% growth noted in the prior quarter and represents the first contraction since the second quarter of 2023. The economic downturn primarily reflects the significant challenges posed by the imposition of a 39% US tariff in early August, which severely affected the nation's export-driven economy. However, a recent trade agreement has reduced the tariff to 15%, offering potential relief to pivotal Swiss export industries and increasing the likelihood of economic recovery in subsequent quarters. The contraction was mainly attributed to a sharp decrease in value added within the chemical and pharmaceutical industries, coupled with negative growth across the industrial sector as a whole. Additionally, the services sector expanded, albeit at a slower-than-usual rate.