ZURICH, March 8 (Reuters) - The Swiss economy will contract more than expected this year and will also shrink in 2010, Sunday newspaper NZZ am Sonntag quoted Swiss state secretary Jean-Daniel Gerber as saying.
"We are preparing our new forecast," said Gerber, who heads the State Secretariat of Economic Affairs (SECO). "But I can already say that gross domestic product will shrink more this year and next than we have anticipated so far," he said.
This pessimistic view follows a SECO forecast in December, which said GDP would likely fall 0.8 percent during 2009 before returning to growth in 2010. The government body will update its forecast on March 17.
Swiss National Bank officials have also indicated that the central bank's December forecast of a 1 percent GDP fall may be too optimistic.
The central bank will release a new forecast on Thursday after its interest rate decision. Most economists see the central bank lowering its target rate for the 3-month Swiss franc LIBOR by 25 basis points to 0.25 percent.
The Swiss economy slid into recession in the middle of last year though it is still holding up better than key trade partners such as Germany.
(Reporting by Sven Egenter; editing by Simon Jessop)