Swiss franc appears overvalued in Big Mac Index analysis

The Economist’s 40‑year‑old Big Mac Index shows that a Swiss Big Mac costs US$9.04 (CHF 7.30), about 45 % more than the US price of US$6.22. When the cost of non‑tradable inputs – labour (46 % of the price), rent (up to 70 % higher) and a 100 % tariff on beef – is adjusted, the Swiss premium falls to roughly 16 %, suggesting the franc is partly overvalued because Swiss workers earn about 80 % more than their US counterparts and rents are substantially higher.

The index, which compares the price of the same McDonald’s burger in over a hundred countries, is used to gauge purchasing‑power parity. Recent editions also highlight other currency imbalances, such as an undervalued Chinese yuan, a weak Japanese yen and a cheap Taiwanese dollar, underscoring the tool’s continued relevance for assessing global exchange‑rate distortions.