Swiss Inflation Healthy for ETF?

Swiss inflation is appearing higher than the Alps, so will the Swiss exchange traded fund (ETF), iShares MSCI Switzerland Index (EWL), be able to tread water?

Economists forecast the recent spike in inflation for the Swiss is the fastest it has been in 15 years, thanks to high energy costs, reports Simone Meier and Joshua Gallu for Bloomberg.

Consumer prices for the Swiss ran up 2.9% from the year before, with a forecasted inflation of 2.4%, according to a Bloomberg study. Swiss economists are working hard to shore up problems, as the National Bank has put interest rates on hold, but if problems arise, they will be forced to push the benchmark higher. And crude oil prices have risen 33% this year – pressure has been added to companies to pass on the higher costs to help earnings.

EWL gives 30.7% to healthcare, and 25.0% to consumer goods, while financial services get 22.8%.

• iShares MSCI Switzerland Index (EWL), down 0.1% year-to-date
• Currency Shares Swiss Franc Trust (FXF), up 8.6% year-to-date

Read the disclosure, as Tom Lydon is a board member of Rydex Funds.