Thursday, 29 November 2012 15:28
ZURICH: The Swiss franc edged up against the dollar on Thursday, tracking the euro which firmed on hopes US policymakers could strike a deal to avoid sharp fiscal tightening, though gains were capped by ongoing concerns over a Greek aid deal.
The franc has shadowed movements in the euro since the Swiss National Bank imposed a 1.20 franc per euro cap more than a year ago after safe haven buyers bid up the Swiss currency and threatened to push the Alpine economy into recession.
SNB chairman Thomas Jordan reiterated the central bank's commitment to the cap for the foreseeable future in a speech on Wednesday evening, saying it was still needed to help keep at bay risks to price stability and economic growth.
Data showed the Swiss economy grew by a stronger-than-expected 0.6 percent in the third quarter from the previous quarter.
"For the SNB, these figures should not make a difference. Even if exports are OK, job losses among export companies are less heartening. They have no choice but to stick with the cap of 1.20," said Sarasin economist Alessandro Bee.
The franc rose 0.1 percent against the dollar compared to the New York close, trading at 0.9283 francs per dollar by 0810 GMT.
The franc was stable against the euro at 1.2036 francs per euro.
Risk appetite was buoyed by hopes that Republicans in the US Congress could broker a deal with the White House to avert a fiscal crisis, lifting equities, but optimism was tempered by concerns over some details of the latest Greek aid package.
Copyright Reuters, 2012