Injury troubles may have made some question Roger Federer's future, but the 17-time grand slam champion insists retirement was never an option.

Federer's 2016 was hampered by knee problems after damaging it running a bath for his daughters, and although he returned to the ATP Tour he opted to take six months out to fully recover after his Wimbledon semi-final defeat to Milos Raonic.

His absence saw him fall down the rankings to world number 17, while his last tournament success came in October 2015 when he triumphed in Basel.

As Andy Murray and Novak Djokovic set new standards there was speculation Federer may retire rather than struggle to compete, but the Swiss maestro dismissed that idea.

"I didn't think of it," the 35-year-old told Sky Sports News. 

"I did go through a conversation with my wife and asked 'what do you think? Shall I just walk away from it?'.

"She was like 'no, not at all because you're not going to walk away this way, running a bath for the girls'.

"I am excited to finish on my terms. I did have a conversation once but it was really not a priority, it was always clear I was going to keep playing."

Federer – who returned at the Hopman Cup last week – will not be one of the top seeds at the forthcoming Australian Open, which makes his chances of success tough, but he hopes to be in grand slam contention later this year.

"First I need five or six good tournaments to get an opinion of how strong I'm going to be, but looking how I played last week I'm quite surprised how well I'm already playing," he added.

"I'm keeping expectations low just because of the very little I've played.

"Playing matches is a completely different animal to practising, [but] I hope after the first three months I'll have a great opportunity to prepare for Wimbledon and the US Open."