Switzerland's economy defied expectations in the first quarter, expanding 0.

Switzerland's economy defied expectations in the first quarter, expanding 0.5% despite headwinds from surging energy prices and a strengthening franc following geopolitical tensions. The growth rate exceeded economist forecasts of 0.4%, driven by contributions from both industrial and service sectors. The resilience is notable given that energy costs spiked and safe-haven flows strengthened the currency, typically headwinds for exporters. A subsequent decline in energy prices in late March may have provided relief. Manufacturing activity remains above growth thresholds after years of weakness, signaling underlying economic strength. Inflation has risen due to energy costs but remains modest compared to other developed economies. The Swiss National Bank is not expected to raise interest rates soon.