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Swiss producer, import prices rise slightly in October
November 13, 2012 / 10:21 AM / 5 years ago

Swiss producer, import prices rise slightly in October

3 Min Read

* Economists see neither deflation or inflation pressure

* Producer/import prices steady at low level

* SNB sees inflation staying low into 2014

ZURICH, Nov 13 (Reuters) - Swiss producer and import prices rose at a muted rate in October, bolstered by the central bank's policy of keeping the franc currency from becoming overly strong.

Producer and import prices rose 0.4 percent in October from a year ago, ticking up from a rise of 0.3 percent in September but below average analyst forecasts of 0.5 percent.

On the month, producer prices were flat while import prices fell 0.3 percent. That compared with forecasts for a combined rise of 0.2 percent.

Seeking to stave off the risk of deflation and recession, the Swiss National Bank imposed a cap of 1.20 per euro on the franc last September. The currency had soared as investors have treated it as a safe haven from economic crisis.

"The October release doesn't really change anything for the SNB," said Credit Suisse economist Maxime Botteron.

"There's still no inflationary pressure and on the other hand, the deflationary effect we saw through lower import prices has also disappeared after the introduction of the 1.20 floor."

Data out last week showed consumer prices fell 0.2 percent from a year ago in October, a bigger drop than analysts in a Reuters poll had expected.

"We see the same as with consumer prices: there is a normalisation but at a low level," said Sarasin analyst Alessandro Bee. "The normalising of prices should be calming for the SNB. The danger of deflation has receded but there is no risk of inflation."

SNB board member Fritz Zurbruegg said in an interview published at the weekend that the central bank expects a slightly positive inflation rate in 2013 and forecasts prices to rise 0.4 percent in 2014.

According to its mandate, the SNB must keep inflation positive but below 2 percent. The SNB holds its next monetary policy assessment meeting on Dec. 13.

For more details of the Federal Statistics Office statement, Reuters 3000 Xtra users can click on:

Reporting by Emma Thomasson and Katharina Bart. Editing by Jeremy Gaunt.

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