Switzerland’s economic growth surged in the second quarter according to initial estimates, shaking off higher energy costs thanks to its chemical and pharmaceutical industries.

GDP growth reached 1.5% after a 0.4% rise in the first three months of the year, the economy ministry said, well above analyst estimates of around 0.3%.

“The industrial sector greatly contributed to growth, driven in particular by the chemical and pharmaceutical industries,” the ministry said in a brief statement.

“The services sector also grew as a whole,” it added.

The Swissmem employers’ association recently noted that industrial firms were benefiting from demand for AI data centre equipment.

And in May, a closely watched survey of purchasing managers saw the index reach its highest level in three years, even with new US tariffs of 12.5% impacting exports.

The Swiss customs office had already announced a 1.7% rise in exports in the second quarter, up from 0.3% the previous quarter.

“The early signs suggest that this momentum will continue into the third quarter,” analyst at Capital Economics said in a research note following the GDP release.

“We have pencilled in a 1.0% quarter-on-quarter rise in GDP in the third quarter, but these indicators suggest that growth could be even stronger,” it said.