Switzerland's exports rose in July, driven by chemical and pharmaceutical products and a pickup in demand from Europe, data from the Federal Customs Office showed. Exports to Europe rose 8 percent, including a 13.9 percent increase to Germany, Switzerland's biggest trading partner, the office said. Europe absorbs almost 60 percent of Swiss exports. A strong Swiss franc has made Swiss goods more expensive abroad, but that effect has been softened by a cap on the value of the franc that the Swiss National Bank imposed almost three years ago. Exports rose an inflation-adjusted 4.5 percent year-on-year in July to 19.258 billion Swiss francs ($21.09 billion), or 5.0 percent on a nominal basis, the data showed. The rise was driven mainly by exports of pharmaceuticals and chemicals, the country's largest export category, which were up a nominal 8.0 percent. Sales of jewellery items jumped 23.7 percent. Though the July reading is buoyant, the pace of export growth is slowing, said Zuercher Kantonalbank economist Cornelia Luchsinger. The bank trimmed its forecast for Swiss growth this week to 1.8 percent from 2.2 percent for this year and to 2 percent next year from 2.3 percent previously. Conflict in Ukraine and the Middle East has dimmed the outlook for Switzerland's exporters. "Companies are also considerably less optimistic about their business expectations in the coming 12 months than they were at the beginning of the year," Swissmem, a lobby group for the electrical and mechanical engineering industry, said on Wednesday. In July, exports of watches rose a nominal 2.2 percent in July to 2.1 billion francs. Sales to mainland China jumped 49 percent, their best performance in 30 months, the Federation of the Swiss Watch Industry said. Imports to Switzerland fell 4.6 percent in real terms and 3.5 percent in nominal terms. Imports of energy sources and consumer goods in particular weakened. The trade surplus widened to 3.98 billion francs in July from a revised 1.41 billion a month earlier. (Reuters)