Switzerland's economy grew by 0.4% quarter-on-quarter in Q1, with industry as the main driving force.

(1) The Swiss government released data on Monday showing that the economy grew by 0.4% quarter-on-quarter in the first quarter of 2026, slightly below the previous preliminary estimate of 0.5% but in line with the long-term average. This marks an improvement from the 0.2% recorded in the fourth quarter of last year. (2) The industrial sector was the main driver of growth, with value added rising by 1.3% quarter-on-quarter, reversing the depressed performance of previous quarters. Manufacturing grew by 1.5%, with income and exports increasing in several industrial sectors. However, value added in the chemical and pharmaceutical industry fell by 3.4%, resulting in an overall 2.2% decline in goods exports. (3) The services sector grew by just 0.2%, showing weak momentum; retail sales declined by 1.3% and private consumption remained flat. The data has been adjusted for the impact of sporting events and seasonal factors, but the rise in energy prices caused by the Middle East conflict has already started to have an initial impact.