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The Swiss inflation rate doubles to 12% in April, as petrol prices soar

Government data released on Tuesday showed that the Swiss inflation rate had doubled in April. It was at its highest level for nearly 18 months as the Middle East conflict drove 'petrol prices' sharply up.

According to the Federal Statistical Office, consumer prices increased 0.6% compared to a year ago, accelerating a 0.3% increase in March.

This figure was higher than expected in an analyst poll.

This increase is largely due to a 17% increase in petroleum prices.

The price of petrol, diesel, and heating oil increased by 0.3% month-on-month.

The FSO reported that "prices for air travel?also increased, as well as those for?international?package holidays." Hotel and supplementary accommodations prices decreased as well as those for car rentals and car sharing.

The Swiss National Bank declined to comment about the figures. It targets an inflation rate between 0%-2%.

Even though the SNB's interest rate is currently 0%, the economists do not expect it to increase at the next SNB meeting in June.

Thomas Gitzel is the chief economist of VP Bank. He said that there is no immediate need to act as the inflation 'rate is still'relatively?low. However, he did add that the SNB may increase rates in the?second half of the year.

Alessandro Bee is an economist with UBS and he expects that the SNB will hold rates at zero percent for the next year.

He said: "Economic growth is below average, and inflation is at a low level despite higher oil prices."

(source: Reuters)