Swiss growth holds steady as domestic demand powers the economy

Switzerland's economy expanded by 1.6% in real terms in 2025, maintaining the broadly steady pace recorded in 2024. The Federal Statistical Office, or FSO, revised 2024 growth up from an initial 1.4% to 1.5%, while also revising 2023 growth upward by 0.2 percentage points. The latest figures show an economy advancing at a measured pace, with households and companies providing more momentum than overseas trade.

The result remains below Switzerland's recent long term average. Real GDP grew by about 2.0% a year between 2005 and 2024, a period that included the global financial crisis, the pandemic recession and the sharp post pandemic recovery. The 2025 performance therefore represents stability rather than a surge.

Domestic demand rose 2.5%, well ahead of overall GDP. Investment accelerated after stagnating in 2024, increasing 3.5%. That combination gives the expansion a broad internal base, although it also points to the limits of export demand in a more uncertain international environment. The figures released by the FSO are first estimates and remain subject to the normal national accounts revision process.

Investment rose 3.5% in 2025, giving the economy one of its clearest sources of fresh momentum. Machinery and equipment investment climbed 3.7%, a signal that companies continued to spend on productive capacity, technology and industrial assets. Construction investment increased 2.9%, supported especially by new buildings. Civil engineering grew more slowly at 1.9%, as higher prices constrained the pace of projects.

Households also sustained demand, although their contribution moderated from the previous year. Consumption grew 1.7% in 2025, compared with 2.1% in 2024. Spending on health care, transport and restaurants was particularly strong. Tobacco and alcohol purchases declined, a shift that reflects changes in household spending rather than a broad retreat from consumption.

The pattern matters for Switzerland's domestic economy. Investment can lift productivity and support future output, while consumption feeds directly into retail, hospitality and local services. Yet the figures do not show whether every investment project will generate the same return. Higher construction costs, weaker global trade and uncertainty over demand could affect business decisions in the months ahead. For now, companies and households have kept the internal economic cycle moving.

Imports grew 11.7%, nearly twice as fast as exports, narrowing Switzerland's trade surplus in 2025. Goods trade excluding gold accounted for much of the gap: imports increased 10.5%, while exports rose 4.8%. The figures indicate stronger domestic purchasing and investment needs, but they also show that external demand added less to growth than it did in stronger export years.

Services provided a partial counterweight. Services exports increased 1.8%, while services imports fell 0.7%, widening the services surplus. Switzerland's international position therefore remained more resilient in services than in goods, even as the overall trade balance weakened.

This composition leaves the outlook exposed to developments beyond Swiss borders. Softer international demand, trade friction and geopolitical uncertainty can weigh on orders for Swiss manufacturers and on corporate investment plans. The FSO data does not quantify the effect of any individual geopolitical event, so the immediate evidence is limited to the trade flows themselves. Those flows show an economy still connected to global markets, but relying more heavily on spending inside Switzerland to maintain growth.