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UPDATE 1-Swiss exports sag in May as watches, chemicals hit
June 20, 2013 / 7:28 AM / 4 years ago

UPDATE 1-Swiss exports sag in May as watches, chemicals hit

* Shares in Richemont, Swatch tumble

* Watch export fall due mainly to gold timepieces

* SNB seen affirming commitment to franc cap (Adds details, analyst comment, shares)

ZURICH, June 20 (Reuters) - Swiss exports fell in May, with a particularly sharp decline in watches, pharmaceuticals and chemicals, the Federal Customs Office said on Thursday.

Exports from Switzerland fell by a real 5.2 percent in May to 17.434 billion Swiss francs ($18.96 billion), but rose by a real 1.7 percent when adjusted for seasonal factors.

Exports of pharmaceuticals and chemicals, the country’s biggest export category, fell 6.8 percent while machines and electronic devices were down 3.2 percent and watch exports dropped 4 percent.

The Federation of the Swiss Watch Industry said the decline was mainly due to a 12 percent fall in sales of gold timepieces, adding there was an unfavourable base effect in the month.

Luxury companies like Richemont and Swatch have seen growth slow in China since the government started an anti-corruption campaign which has hit purchases of expensive timepieces as gifts for business partners.

Richemont shares fell 3.6 percent and Swatch was down 3.8 percent by 0706 GMT, compared to a 2.3 percent weaker European sector index.

The watch federation said exports to Hong Kong fell nearly 16 percent, 19 percent to China and almost 15 percent to France, but rose to Italy and Germany.

“The slight decline of the watch export figures in May is about in line with expectations. We expect an improvement in demand in the course of the year,” said Patrick Hasenboehler, analyst at J. Safra Sarasin bank.

Swiss exports have been supported by a cap the central bank imposed on the soaring franc currency in 2011, but have suffered from sluggish demand in Europe, the country’s biggest trading partner.

The trade surplus widened to 2.224 billion francs in May from 1.698 billion a month earlier.

The Swiss National Bank is expected to reaffirm its commitment to defend its lid on the safe-haven currency at its June monetary policy assessment due at 0730 GMT. ($1 = 0.9194 Swiss francs) (Reporting by Emma Thomasson; Editing by Toby Chopra)

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