The Swiss economy is further strained amid the slowing global recovery, debt crisis in the euro area and unstable financial markets and accordingly the outlook for the economy keeps to darken with deflation threats.

The KOF leading indicator for December a gauge for the economic outlook in the three to six months coming period slumped to 0.01 unexpectedly from a revised 0.34 from 0.35 and was much below the expected 0.23 confirming the downbeat expectations for the economy amid rising uncertainty.