Swiss economy expanded steadily in 2025 as domestic demand led growth

Swiss real GDP expanded 1.6% in 2025, according to first estimates from the Federal Statistical Office, keeping the economy on a broadly stable path after 1.5% growth in 2024. The result offers a picture of resilience, though it remains below Switzerland's longer term pace. Real GDP grew by about 2.0% a year on average between 2005 and 2024, a period that included the global financial crisis, the pandemic recession and the sharp rebound that followed.

The composition of growth mattered more than the headline alone. Domestic demand increased 2.5%, providing the main lift as companies and households spent at home. Investment delivered the strongest acceleration, rising 3.5% after stagnating in 2024. Household consumption also contributed, though at a slower rate of 1.7%, compared with 2.1% the previous year.

The figures were revised alongside the 2025 estimate. The FSO lifted its 2023 growth figure by 0.2 percentage points and its 2024 figure by 0.1 points, putting the previous year's expansion at 1.5%, up from the initial 1.4%. The revisions reinforce a steady, carefully measured expansion rather than a sudden change in direction.

Investment rose 3.5%, turning a flat performance in 2024 into one of the economy's clearest growth engines. Companies increased spending on machinery and equipment by 3.7%, a sign that firms continued to renew productive capacity despite a moderate overall growth environment. Construction investment climbed 2.9%, led particularly by new buildings. Civil engineering grew more slowly at 1.9%, with higher prices weighing on activity.

Households added another layer of support. Consumption by households and non-profit institutions serving households increased 1.7% in real terms. Health care, transport and restaurants recorded particularly strong spending. Tobacco and alcohol moved in the opposite direction, with consumption falling in both categories.

Together, the figures show an economy supported by domestic decisions that are closer to Swiss households and companies than to overseas demand. Investment can strengthen future output when it improves equipment, buildings and business capacity. The national accounts do not establish how much of the spending reflects productivity gains or temporary catch-up, so the durability of this support will depend on whether firms continue to invest as global conditions evolve. For now, Switzerland entered 2026 with a stronger domestic base than the previous year's figures suggested.

Imports grew 11.7%, twice the pace of exports, reshaping the external balance in 2025. Exports rose 5.9%, but the faster increase in imports narrowed Switzerland's trade surplus after it had widened the previous year. The gap was especially clear in goods excluding gold: imports climbed 10.5%, while exports increased 4.8%.

Services provided some offset. Switzerland's services surplus widened as exports rose 1.8% and imports fell 0.7%. That performance helped preserve part of the country's external strength, even as goods trade became less supportive of growth.

The trade figures also clarify the domestic-demand story. Stronger household and business spending often draws in more foreign goods, so the import surge is consistent with an economy where consumption and investment are carrying more of the expansion. It also means the external sector contributed less to the 2025 balance than it did in the previous year.

Switzerland remains deeply exposed to international trade, particularly through manufacturing, chemicals, pharmaceuticals and financial services. A weaker trade surplus does not by itself signal an economic downturn, but it leaves future growth more dependent on the strength of domestic spending and the ability of Swiss exporters to maintain demand abroad.

Financial services grew 6.6%, with banks rebounding 8.1% after a decline in value added the previous year. Insurers also delivered strong growth of 7.6%, making finance one of the most significant sectoral supports in the 2025 economy.

Manufacturing expanded 2.4%, powered in part by coking and oil refining and by the chemical and pharmaceutical industries, which together grew 8.1%. Retail trade rose 3% in real terms, while broader trade, including commodities, increased 5.2%. These results point to a wide set of contributors, although performance varied sharply across the service economy.

Health and social work grew 5.2%, adding weight to domestic activity and reflecting the sector's importance in Swiss employment and household spending. Arts, entertainment and recreation recorded the largest decline, falling 29.3%. The FSO linked much of that drop to the absence of major international sporting events in 2025, following their presence in 2024.

The uneven sector results caution against treating GDP as a uniform national experience. Zurich's financial institutions, Basel's life sciences companies, retailers and care providers may have faced very different conditions. The available figures identify sector patterns, but they do not provide a canton-by-canton growth ranking.

Switzerland's 2025 expansion rests on domestic demand, with investment providing its strongest forward-looking signal. The economy grew steadily, but the 1.6% real GDP increase remained below the 2005 to 2024 average of about 2.0%. That gap leaves little room for complacency, especially for an economy whose companies depend heavily on foreign markets.

The immediate outlook begins with a solid internal platform. Household consumption continued to rise, investment accelerated and health, retail, finance and manufacturing all expanded. If firms sustain spending on machinery, equipment and construction, they could support capacity and productivity beyond the initial boost recorded in 2025. The national accounts alone cannot determine how that investment will translate into future output.

External risks remain visible in the trade data. Imports advanced much faster than exports, and the narrower goods surplus reduced one traditional source of support. Services trade was stronger, while chemicals and pharmaceuticals posted especially rapid growth. Switzerland's next phase will therefore depend on both domestic confidence and exporters' ability to maintain international demand.

GNI at current prices rose 2.5%, close to nominal GDP growth of 2.4%, indicating that income received by Swiss residents also increased. The figures describe a stable economy entering the next year, with momentum concentrated in investment and domestic spending.