The Swiss federal government's expert group on Tuesday downgraded its economic outlook citing weak global conditions. Nonetheless, the group does not foresee a marked recession in Switzerland thanks to the robust domestic economy and the floor currency exchange rate.

The State Secretariat for Economic Affairs (SECO) forecast the economy to expand 1 percent this year, down from the prior estimate of 1.4 percent. It forecast a modest growth over the coming quarters.

For 2013, the growth projection was trimmed marginally to 1.4 percent from 1.5 percent.

According to expert group, decisions taken by the European Central Bank have reduced the risks of a further escalation in the sovereign debt crisis within the Euro region, however these risks still remain.

The slowdown in economic activity is also slowly being felt on the labor market, it said. The government forecasts annual average unemployment levels of 2.9 percent for 2012 and 3.3 percent for 2013.

RTTNews