Swiss watch exports fell slightly in July, the first monthly drop in more than two years, as demand began to slow amid higher prices and economic pressures, Bloomberg reported, citing Agerpres.

Statistics released by the Federation of the Swiss Watch Industry showed that watch exports fell 0.9 percent in value terms to 2.2 billion Swiss francs ($2.5 billion) last month amid weaker demand, particularly from China.

Exports to China, the second-largest market after the US, fell 16.6% in July after strong growth last year. Another key market, Singapore, fell 7.9%. In July, deliveries to the USA increased by 5.2%.

In 2021, the US overtook China to become the main market for Swiss watches. The data suggests that high demand for expensive Swiss watches has started to wane, with Swiss watch exports reaching a record high of more than 24 billion francs last year as a whole.

Brands from Omega to Patek Philippe and Rolex have raised prices to compensate for higher production costs.

Every tenth product exported by Switzerland is a watch

Zuercher Kantonalbank analyst Patrick Schwendimann said the monthly drop in exports is unexpected and could weigh on shares of Richemont and Swatch Group AG.

“However, as usual, one month of decline in watch exports should not be overestimated,” he explained, predicting a recovery in export growth in August and September. The last monthly decline in Swiss watch exports was in January 2021.

“The slight decrease will not have a significant impact on the overall trend forecast for 2023,” the Federation of the Swiss Watch Industry said.

Exports decreased in all price segments, except for watches priced above 3,000 Swiss francs, which recorded an increase of 2.2%. The watch industry accounts for approximately 10% of Switzerland’s total exports and provides approximately 57,000 jobs.