The KOF Swiss Economic Institute released its growth forecasts for Switzerland on Wednesday. The Swiss economy is expected to expand 1.0% in 2016, down from the previous estimate of 1.1%, and 2.0% in 2017, unchanged from its previous estimate.

The downward revision was driven by the global economic weakness and the structural adjustments in Switzerland.

"Following a difficult 2015 for the Swiss economy as a whole, the prospects are gradually brightening. The weak international development towards the end of 2015 curbed the opportunities for exporters. Thanks to the gradual recovery of the economies of Switzerland's trading partners, the local economy is expected to regain its footing," the KOF said in its statement.

The KOF forecasted that consumer prices in Switzerland would be at -0.7% year-on-year in 2016, down from the previous estimate of -0.5%, and 0.1% in 2017, down from the previous estimate of 0.2%.

The unemployment rate is expected to be 3.5% in 2016, down from the previous estimate of 3.6%.