As their home country achieved a large cut to US tariffs, two of the Alpine's states largest banks opine on the likely financial impact.

Swiss banks Lombard Odier and Julius Baer have said that the US administration’s move to cut tariffs on Swiss imports to 15 per cent from 39 per cent will boost the Alpine state’s economic growth. As part of the deal, Switzerland will invest $200 billion into the US.

“Overall, the tariff deal marginally improves the growth outlook for Switzerland,” Sophie Altermatt, economist, Julius Baer, headquartered in Zurich, said in a note.

Separately, the Swiss government said the US tariffs, imposed in August, and slower global growth had taken their toll on GDP. An initial estimate showed that GDP shrank from July to the end of September. Fuller data will be issued on 28 November.

“With that, Switzerland faces the same ‘reciprocal’ tariff rate as the European Union, eliminating the competitive disadvantage for Swiss companies in the US market. This provides relief for smaller and US-oriented companies, which have been hit hardest by the tariff escalation, and eases pressure on the Swiss economy,” Altermatt said in a note.

At Lombard Odier, the Geneva-headquartered private bank said it has increased its Swiss GDP growth forecast for 2026 from 0.9 per cent to 1.2 per cent; it estimates that the hit to GDP growth from US tariffs will decline from 0.5 per cent to 0.2 per cent.

“Our portfolios are positioned to benefit, with an overweight exposure to Swiss equities. We anticipate slightly higher bond yields and see the Swiss franc posting measured gains,” the bank said. 

“We increased our exposure to Swiss stocks to overweight in September, as we anticipated upside potential in a market that is heavily weighted to healthcare and financial sectors, with attractive valuations and improving earnings,” it said. “The Swiss franc is also rebounding and should gain modestly in an environment where we continue to expect a softer US dollar. We expect the Swiss sovereign bond yield curve to steepen, given an already low inflation forecast from the SNB, and positive news on tariffs supporting growth. Short-dated government bond yields should remain negative, depending on Swiss franc strength.”

The deal brings Switzerland’s tariff rate into line with the neighboring European Union. 

Lombard Odier said US tariffs on Swiss pharmaceuticals “remain a wildcard” in trade talks with the US, as the sector may still be subject to sectoral duties. 

A challenge to the constitutional basis of the US import tariffs levied through International Emergency Economic Powers Act (including tariffs on the Swiss economy) is before the US Supreme Court – creating a level of uncertainty. 

“A ruling against the application of tariffs by the Supreme Court is likely to have minimal impact on markets because there are alternative mechanisms for the US to impose duties. In any case, if the Trump administration replaced some of its existing tariff mechanisms, they would likely only be lowered to the same level of 15 per cent,” Lombard Odier said.

Adrian Prettjohn, Europe economist at Capital Economics, said the tariff cut should boost Swiss growth in the next few quarters.

"Assuming it is implemented soon, the deal to lower US tariffs on Switzerland from 39 per cent to 15 per cent would leave Swiss exporters paying the lowest US average tariff rate of any major economy, at around 7 per cent. Even if the 14 per cent appreciation of the franc against the dollar this year weighs on exports to some extent, we expect economic growth to rebound strongly in the coming quarters," he said.