Swiss defy inflation to splash out on Christmas gifts

Christmas shoppers on Zurich's Bahnhofstrasse © Keystone / Gaetan Bally

Swiss consumers have budgeted more for Christmas presents this year despite the growing spectre of inflation.

The average shopper plans to splash out CHF343 ($367) on presents, up CHF9 from the average spend in 2021.

The cost of consumer goods has risen around 3% in recent months, which is well below the inflation rate of other countries but still above the 2% target set by the Swiss National Bank (SNB).

The SNB has raised interest rates three times this year in an effort to curb inflation, most recently on December 15. The central bank expects annual inflation to weigh in at 2.9% by the year’s end.

However, a survey by consultancy group EY shows that this is having little impact on consumer sentiment in the festive season.

Although many people will be watching their pennies and keeping a nervous eye on rising energy costs, they show little inclination to cut back on presents for family and friends.

Consumer experts told Swiss public broadcaster SRF that people still crave the feel-good factor of buying presents for others. This sentiment may have been heightened by Covid ruining the last two Christmases.

In addition, consumers have been buoyed by the spending power of the Swiss franc that cushions some of the effects of inflation.