Switzerland - Still on top of the Big Mac Index - January 31, 2017

According to Big Mac Index 2017 Switzerland still has the most overvalued currency in the world. Big Mac index was invented by The Economist in 1986 as a light-hearted guide to whether currencies are at their ‘correct’ level. It is based on the theory of purchasing-power parity (PPP), the notion that in the long run exchange rates should move towards the rate that would equalise the prices of an identical basket of goods and services (in this case, a burger) in any two countries. However, the situation is different in an adjusted version of the index which takes into account labour costs and GDP. When adjusting for the country’s average income, the franc is only overvalued by four percent, it found.

English: http://www.economist.com/content/big-mac-index …   

For more information, please contact the editor Jan Cremers, Amsterdam Institute for Advanced Labour Studies (AIAS) cbn-aias@uva.nl or the communications officer at the ETUI, Willy De Backer wdebacker@etui.org. For previous issues of the Collective bargaining newsletter please visit http://www.etui.org/E-Newsletters/Collective-bargaining-newsletter. Since June 2013 readers can consult our archive and search through all articles in our database at www.cbnarchive.euYou may find further information on the ETUI at www.etui.org, and on the AIAS at www.uva-aias.net.

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