31 October 2001, 09:38  SNB's Gehrig: 2002 Swiss GDP around 1%, Eyeing Forex

FRANKFURT (MktNews) - Switzerland is not facing a recession next year, as growth is likely to be 1% or higher, Swiss National Bank Vice President Bruno Gehrig said Tuesday. Growth is likely to be closer to the lower end of current forecasts ranging from 1% to 2%, Gehrig told reporters at Swiss-German business conference here. The financial difficulties of the carrier Swissair should not have a major impact on the economy, as the effect is likely to be more psychological, he said. Amid the global slowdown, the central bank will follow closely the impact of the exchange rate on the economy, Gehrig said. "Of course the foreign exchange rate plays a key role in the assessment of economic developments and we certainly face a situation where economies obviously slowing down," he said. "It's clear that an appreciation of franc is not good," he said. Therefore we will closely monitor future (forex) developments and we will evaluate the forex rate in a broad context." The U.S. economy is likely to recover gradually over the course of next year after a downturn in the fourth quarter, Gehrig said. "The measures which have been taken in the U.S. will certainly not lead to a strong boost in the first quarter," he said. While the sharp deterioration in U.S. consumer confidence aggravates the situation, Gehrig said he was less concerned about confidence in Europe, which appears more robust.

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