By John Revill
ZURICH, April 2 (Reuters) – Swiss inflation rose to its highest level in a year in March, government data showed on Thursday, albeit less than expected, as the country absorbed higher fuel costs triggered by the conflict in the Middle East.
Consumer prices rose by 0.3% last month, compared with March 2025, the highest rate in 12 months.
Still, the uptick from the 0.1% level in February came below the 0.5% rate forecast by economists in a Reuters poll.
Month-on-month, Swiss prices increased by 0.2%, also below the 0.5% rate expected.
The increase was driven by prices for petroleum products, which were 5.3% more expensive compared to a year earlier.
Prices for air transport and package holidays also increased, said the Federal Statistical Office, which compiles the data.
The Swiss National Bank, which targets inflation between 0 and 2%, declined to comment.
Swiss annual inflation remains well below the 2.5% expected rate in the euro area, and means the SNB is unlikely to immediately hike interest rates to tackle price rises, analysts said.
Markets currently give a 21% probability the central bank will increase borrowing costs from the current 0% at its next meeting in June.
“The rise in inflation is only modest and will not make the SNB thinking about potential rate hikes, in our opinion,” said UBS economist Alessandro Bee.
GianLuigi Mandruzzato, an economist at EFG Bank, said the moderate uptick showed Switzerland was relatively isolated from the energy price shock.
“The SNB will be on alert for any sign of second-round effects, but for the time being there is little reason to react to the shock also on account of the high uncertainty about how the crisis will unfold,” he said.
(Reporting by John Revill, Editing by Friederike Heine and Tomasz Janowski)
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