Release Explanation: Measures the monetary value of all goods and services produced within a Country’s borders in a specific time period. GDP is calculated on an annual basis, is the broadest measure of activity, and the primary gauge of each economy’s overall health. It includes all Company and Personal consumption, government outlays, investments, and exports minus imports, that occur within a defined territory.
Trade Desk Thoughts: The Swiss economy contracted less than expected in the fourth quarter. From Q3 to Q4 2008 the economy shrank 0.3%, while compared with the fourth quarter of 2007 the economy contracted 0.6%. The data for the third quarter was revised lower to -0.1%, indicating that the economy contracted for two consecutive quarters in Q4 2008.
The fourth quarter data shows that investments and exports had a negative contribution. Investments fell 3.1% in Q4, while exports contracted by 8.1%, outpacing the contraction from the import sector. Household expenditures still had a positive impact on the quarterly read, even though it was a small amount.
Some earlier forecasts suggested that the Swiss economy would contract by 1% in 2009. Compared with the quarterly data from its main trading partners in the Euro-area, Japan and the U.S, the Swiss economy is still looking very resilient.
Forex Technical Reaction: The Swissy had a weak reaction to the GDP release. For now, the swissy struggles to break under the Monday’s low, after it fell 70 pips overnight.