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Geneva's economy: Genuine recovery rather than just a rebound?
The LEA-PICTET-OCSTAT leading indicator for the Genevan economy has perked up quite noticeably since the early summer. Although its October 2009 reading was still pitched some 5% below where it had stood twelve months earlier, it has bounced back up by 5.5% since its May 2009 low. Although the October figure is still a preliminary estimate (with the autumn quarter’s data still outstanding), this uptick doubtless signals more than just a simple reflex rebound, but a genuine recovery in Geneva’s economic activity – what is more, this upswing may well prove sustainable.
Firstly, the uptick is not an isolated phenomenon as several statistics released recently have been pointing towards the improving state of the economy worldwide. Secondly, the Geneva index is tracking, to all intents and purposes, the same sort of course that it has done during previous recoveries. On this score, it should be borne in mind that the recession just ending in Geneva turned out to be less severe and shorter-lived than the downswing which had debilitated the canton from 1990 to 1995, but it was harsher than the slowdown experienced in the early years of the 21st century. The 1990-95 crisis had, above all, hit the construction and building sector which, both directly and indirectly, generates plenty of employment whereas, this time round, this particular segment of the economy in Geneva did not suffer unduly.
Lastly, the financial sector and exports only endured temporary bouts of weakness thanks to the raft of measures implemented to assist these two sectors. Geneva’s economy thus looks to be on course to extend its recovery...
Leading Index LEA-Pictet-OCSTAT for Geneva | 
