The leading economic indicator remained above its 100 long-run average for a second straight month in February. However, at 101.6 the latest reading was slightly short of the market consensus and nearly 1 point under January's upwardly revised level.

Prospects for the manufacturing and construction sectors improved but the outlook for financial and insurance services, hospitality, other services and foreign demand all deteriorated. Consumption was broadly stable.

The February reading points to near-term growth a little above its historic norm and so adds no additional pressure on the SNB to cut interest rates next month, even with inflation having stabilised below 2 percent since last May. That said, today's updates put the Swiss RPI at minus 29 and the RPI-P at minus 10 meaning that overall economic activity is falling slightly short of forecasts.

The headline index is seen rising further in February to 102.0.

The KOF Economic Indicator is a composite leading indicator that aims to identify shifts in the Swiss business cycle around three months ahead of the actual event and, until the start of 2014, was based on twenty-five different economic indicators. The old version of the KOF Economic Indicator used the previous year's GDP growth rate published by the Swiss State Secretariat for Economic Affairs (SECO) as a yardstick. The revised measure still incorporates SECO data; however, KOF has changed over to month-on-month changes in GDP which are generated via statistical methods. This reference series is not about exact GDP figures but about the direction and strength of the economic trend. The new objective of the Barometer is the same as the old objective: achieving maximum possible accuracy in predicting the Swiss business cycle.

The indicator measures overall economic activity through a qualitative business survey about developments in the recent past, the current situation and expectations for the next three to six months. Getting an accurate handle on where the economy is headed is inevitably a vital element in all investment decisions and the new measure uses some 219 variables in order to do just that. The set of variables will be reviewed every autumn.

Survey questions relate to production, orders and stocks of finished goods. The KOF Swiss Economic Institute publishes this indicator monthly.