Strategy update: Inflation, markets, and cash in transition
A look at interest rates, stock markets, and payment behavior in Switzerland
Stock markets & economy
Despite cautious statements from central banks, many stock markets continued their upward trend. Economists continue to expect solid global growth of around 2.8%. The US labor market is particularly robust, with rising wages driving consumption—which, however, could keep inflation stubbornly high.
Cash & digital payments
Cash is becoming less and less important in Switzerland: only around 36% of all transactions are now made in cash. Younger people in particular are increasingly choosing not to use cash at all. Nevertheless, cash remains important – as a store of value and as a safeguard in the event of power outages or in remote regions. A healthy mix of cash and digital payments creates flexibility.
Job market & Consumption
The US labor market remains surprisingly robust despite global uncertainties. The number of job vacancies has even risen recently, while the resignation rate is slowly declining. Particularly impressive is the fact that wage growth is around 6%, supporting consumption as an important driver of economic growth. Many industries continue to experience a shortage of skilled workers, which in turn is driving wages. As long as corporate earnings do not collapse, the labor market is likely to remain strong – with positive effects for the domestic economy, but also some inflationary pressure.
