After the war in Ukraine triggered global inflation in February 2022, prices of many common consumer goods in Switzerland have soared — some by as much as 20 percent.
What will happen, in terms of prices, in 2024?
The good news is that inflation has fallen in Switzerland — from 3 percent in 2022 to below 1.7 percent currently, which has also brought prices of some consumer goods downward.
While the inflation rate is expected to rise slightly at the beginning of next year — to 1.9 percent — prices of some consumer goods and services will drop, even if slightly.
But first let’s look at costs that will actually increase in 2024..
Health insurance premiums
They will go up by 8.7 percent. This is a national average, which means some people will pay more and others less — though the increase will hit everyone.
Ticino residents, for instance, will experience the highest increase — 10.5 percent.
Premiums in a number of other cantons will also exceed the 8.7-percent national average — for instance, Zug (10.2), Nidwalden and Thurgau (9.5), Vaud (9,9); Geneva (9,1); and Neuchâtel (9.1).
On the other hand, Zurich’s increase will be below the national average — 8.3 percent.
And Basel-City’s residents, along with Appenzell-Innerrhoden’s, will be able to enjoy the country’s lowest increase: 6.5 percent.
Electricity
In 2024, these tariffs will increase by an average of around 18 percent for households.
However, here too, these prices could be higher or lower than the national average in individual cantons and municipalities.
Zurich residents, for example, can expect a 24.5-percent increase, in Geneva rates will go by 28.6 percent, and in Vaud, which has many electricity suppliers, hikes will range from 32 to over 40 percent.
This government map shows by how much electricity prices will go up in your community.
Rents
After seeing their rents increase by 3 percent in October, many tenants will be hit by another 3-percent hike in April, after the Federal Housing Office announced that it is raising the reference mortgage rate, which is used to determine rents, from 1.50 to 1.75 percent.
This means that if your rental contract is based on the reference rate, your rent will go up.
About 54 percent of rental contracts in Switzerland are based on the reference rate.
Regionally, however, even a larger number of rentals are affected.
In the Zurich area, as well as in central Switzerland, for instance, more than 60 percent of rental contracts are based on a reference rate.
In the Bern region, as well as in northwestern parts of the country, that proportion is just over 53 percent, while in the western and southern cantons (which include Geneva and Vaud), less than half of rental contracts are tied to the reference rate.
READ ALSO: Switzerland sees new rent hike but will yours go up?
Public transportation
From December 10th, when the new train timetable kicks off in Switzerland, the new (higher) tariffs will go into effect as well.
For the first time in seven years, the price of GA Travelcards — annual subscriptions that give commuters access to Swiss public railways, post buses, public boat services, as well as the urban local transport in buses and trams — will increase by about 4.3 percent.
READ ALSO: How the Swiss Travelcard will get more expensive
Now for the good news: prices that are expected to drop
Economists interviewed by 24 Heures Lausanne daily newspaper say that consumers will pay less for heating oil, fruits, and vegetables; other products could become cheaper as well.
If you like travelling, you will be glad to know that hotel prices, as well as those of international package holidays will also be less expensive.
Last but not least, a new law that came in to force on January 1st, 2024, will lower the price of some imported merchandise sold in Switzerland.
From that date, import duties on almost all industrial products will be abolished, which means that goods such as bicycles, cars, household appliances, clothing, and footwear will no longer be subject to customs duties when imported into Switzerland.
Consequently, their prices will drop.
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It would be useful to explain how inflation dropping from 3 percent in 2022 to below 1.7 percent currently relates to prices dropping. The reason I mention this is because Inflation is a rise in prices. A drop in the rate indicates prices continue to rise albeit at a slower pace. For prices to drop, I would expect a negative rate, or deflation.
Thank you for your article.