The Swiss economy grew by 0.3% in the third quarter of this year, according to a government statement on Friday, as the service sector helped to counter weakening growth in manufacturing.

The growth rate – adjusted for sporting events – was an increase from the 0% GDP growth between April and June and surpassed the 0.1% growth forecast in a poll carried out by Reuters news agency.

Switzerland's economy grew 0.9% year-on-year, exceeding the 0.5% forecast.

"The international environment remains challenging, with value added in industry stagnating accordingly," said the State Secretariat for Economic Affairs (SECO), going on to add that the country's service sector was able to provide support once again

Furthermore, Eurostat said last month the European Union GDP – Switzerland's largest export market – was flat in Q3, whilst Swiss surveys have indicated muted economic activity, Reuters reports.

The country's manufacturing purchasing managers' index for November stayed under the government's 50 threshold for the 11th consecutive month, increasing to 42.1 points due to an ongoing contraction in production.

"The weakness in manufacturing has spread to the labour market, with the employment component dropping to 46.0 points, its lowest level since October 2020 and the second consecutive print below the growth threshold," according to procure.ch and UBS.

Back in September, the Swiss government said it forecasts the country's economy to grow by 1.3% in 2023, followed by a 1.2% rise in 2024, both a slowdown from Switzerland's long-term average growth rate of 1.7%.

The government will announce its latest forecasts on 13 December.