The economy is still expanding, but growth is slower than the rapid rate experienced earlier this year, according to a newly released study of Swiss business.

The study, by the Institute for Business Cycle Research (KOF) at the Federal Institute of Technology, said that despite the slowdown there was no reason to believe that Switzerland's economy was about to enter negative waters.

The quarterly survey of about 5,000 companies found exports slowing but still strong helped by a healthy global economy.

In the fourth quarter of the year, companies with domestic-based businesses were more confident than exporters.

Orders were expected to slow in the next six months indicating a medium term cooling down but third quarter orders were still robust. The KOF survey said production was approaching 84 per cent of capacity.

Even the construction industry is benefiting after being one of the country's weakest sectors throughout the 1990s. Three quarters of the companies surveyed in the building industry reported full order books, the highest level since 1994.

Employment is also strong, with 37 per cent of companies saying they had taken on new people. Some 15 per cent said their staffing levels were too low.

swissinfo with agencies