Swiss GDP contracts for first time in two years as US tariffs bite
By Benjamin Chiou
Date: Monday 17 Nov 2025
(Sharecast News) - The Swiss economy contracted in the third quarter for the first time in more than two years, according to the State Secretariat for Economic Affairs on Monday, as US trade tariffs weighed heavily on exports.
Gross domestic product declined by 0.5% over the July to September period, pulling back after a 0.1% gain in the second quarter and a 0.7% expansion in the first.
This was the first quarterly contraction since the second quarter of 2023, and the only the second time GDP has fallen since the onset of the Covid pandemic in 2020.
The drop in economic activity was largely thought to be a result of the 39% tariff rate imposed by the US on Swiss imports introduced in August, which impacted Switzerland's pharmaceuticals and chemicals sectors in particular.
"Driven by a sharp decline in value added in the chemical and pharmaceutical sector, industry as a whole recorded negative growth. The services sector grew at a below-average rate," the State Secretariat for Economic Affairs said.
Meanwhile, wider industry as a whole contracted, while activity in the services sector posted below-average growth.
The data follows Friday's agreement between Washington and Bern to lower duties on Swiss imports into the US to 15%, bringing tariffs in line with those imposed on neighbouring EU countries.
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