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INSTANT VIEW 2-Swiss CPI down 0.4 pct y/y in Sept

Swiss consumer prices fell 0.4 percent from a year ago and were 0.3 percent higher compared with the previous month, the Federal Statistics Office said on Mo nday.

ANALYSTS' COMMENTS CORNELIA LUCHSINGER, ZKB

"This is more of the same, but prices are going in the right direction. The negative price dynamics are running out now, especially because the Swiss franc floor has been there a year now.

"In August we had month on month inflation flat, the negative price dynamics are flattening out now and getting positive again. We expect month on month inflation to be positive and year-on-year inflation to be positive by the end of the year."

MAXIME BOTTERON, CREDIT SUISSE

"They're in line with our expectations. If you look at the average of Q3, you get a -0.5 y/y, exactly what the SNB said. So the prices are developing as expected."

"For the coming months we expect inflation just above zero, possibly even above 1 percent in early 2013. That's chiefly due to base effects and can hardly be regarded as inflation."

"That shouldn't mean the SNB will deviate from its policy - there's no inflationary pressure in Switzerland at the moment."

ALESSANDRO BEE, SARASIN

"The trend of the last two to three months of deflation weakening has continued. What is responsible for this is that the basis effect from last year is disappearing. The general trend in Switzerland is that there is no inflation, oil prices are also calming. For the end of the year we expect inflation around zero so that is no reason for the SNB to change course.

"The situation is a bit more comfortable for the SNB than a few months ago. The franc is not sticking to the 1.20 level any more and sight deposits are no longer rising. The SNB can sleep a bit easier. The main drivers for the franc for the next two to three weeks will be whether Spain seeks a bailout and what happens in Greece."

KEY POINTS FROM THE SURVEY

*"The rise in the consumer price index in Sept. 2012 by 0.3 percent is chiefly due to the end of the sales in the clothing sector and to higher prices for petroleum products."

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Keywords: SWISS ECONOMY/CPI