ZURICH: The Swiss franc traded lower against the dollar on Wednesday but remained in a tight range against both currencies as renewed caution over the euro zone debt crisis lent some support to the greenback.
Traders said that with little macroeconomic data of importance due, exchanges were muted and investors were unwilling to take on risky bets despite hopes Europe could beef up its bailout fund for troubled euro zone economies.
"The market catalysts remain Greece and European debt, whatever outcome there is will be reflected in the euro level against the dollar, with the franc tracking the euro," said one Zurich-based money market trader.
The Swiss franc had been bought heavily by safe-haven investors as debt crises in the euro zone and the United States deepened, and had flirted with parity with the single currency until the Swiss National Bank capped the franc at 1.20 per euro on Sept 6. It has remained close to that mark ever since.
"The euro-Swiss is stuck in a tight range here with support at 1.2170/50 and resistance at 1.2230/50," said another trader.
"Tomorrow's vote in Germany (on widening the scope of the European Financial Stability Facility bailout fund) could create some movement, which will also be reflected in franc-dollar trading."
The franc fell 0.3 percent against the euro compared to the New York close, exchanging hands at 1.2211 francs to the euro at 0631 GMT.
The franc fell 0.3 percent against the dollar to 0.8898 francs per dollar.
"Price action in the key CHF crosses remains muted for now. As such, the dollar-franc consolidates around 90," said UBS analyst Reto Huenerwadel in a note.
"With the euro-franc glued at just above 1.20 future gains will depend on the euro-dollar moves going forward."
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