ZURICH: The Swiss franc hovered against both the dollar and the euro ahead of a busy week of economic data and central banking events, including expectations the European Central Bank will unveil its strategy to tackle the euro zone debt crisis.
The franc has largely tracked the euro since the Swiss National Bank set a cap on the currency of 1.20 per euro last Sept. 6, after safe-haven investors pushed it up sharply within just a few months, raising the risk of a recession.
SNB Chairman Thomas Jordan is expected to reiterate his commitment to that policy in a speech later on Monday ahead of the SNB holds its next rate review on September 13. Vice Chairman Jean-Pierre Danthine is also due to speak on Wednesday.
Meanwhile, the ECB holds its policy meeting on Thursday and could unveil details of how the bank's proposed bond-market intervention will work, despite doubts of the Bundesbank over its legality and effectiveness.
"We expect the euro to trade with a bit more of a defensive tone before the ECB rate decision on Thursday," wrote analysts from Credit Agricole.
"Although there is some scope for disappointment expectations of major ECB action have already been pared back."
The franc was flat against the dollar to trade at 0.9549 by 0552 GMT compared to the New York close. It was also little changed against the euro at 1.2008.
It is also a busy week for economic data for Switzerland, with the purchasing managers index for August due later on Monday, second-quarter gross domestic product (GDP) growth due on Tuesday and August consumer prices out on Wednesday.
"We expect GDP and CPI to confirm their latest change in trend. As such, we look for a further fading growth momentum," said UBS economist Reto Huenerwadel.
Comments
Comments are closed for this article.