The export-reliant country’s economy grew 0.1% in the April-June period compared to Q1, when it expanded by 0.8%, according to the economy ministry.

“The negative performance in industry has been counterbalanced by gains in the services sector,” the ministry said in a statement.

Growth had accelerated in the first three months of the year as shipments of pharmaceutical goods to the US, a major export, surged in anticipation of President Donald Trump’s tariff onslaught.

“Growth slowed significantly in Switzerland in Q2 as tariff front-running eased,” said Adrian Prettejohn, a Europe economist at London-based research firm Capital Economics.

“We suspect the slowdown will have been most acute in the pharmaceutical industry, after firms rushed to export goods to the US in Q1,” he said.

Trump imposed a “baseline” 10% tariff on imports from around the world in April and warned that dozens of countries, including Switzerland, would face even higher levies.

Swiss goods exports fell 5.3% in Q2 compared to the first three months of the year as shipments of chemical and pharmaceutical products fell, customs data showed last month.

Watch exports, however, jumped in April as US importers rushed to build their stocks after Trump warned that Switzerland could be hit with a 31% tariff.

Trump shocked Switzerland by signing off on an even bigger duty of 39% on the country on Aug 1, more than double the tariffs that were imposed on its European Union and Japanese competitors.

The Swiss government is still hoping to negotiate a lower tariff after last-ditch talks in Washington failed to change the US government’s mind.

While pharmaceutical products have been spared so far, the US leader has threatened to hit the entire sector with tariffs of as much as 250% if drug prices do not drop.

“The economy is likely to expand only slowly the next couple of quarters as high US tariffs and elevated business uncertainty weigh on exports and investment,” Prettejohn said.