ZURICH: The Swiss franc plummeted to its lowest since early January against the euro on Friday, with equity markets and other risky assets getting a lift from the US Federal Reserve's latest stimulus measures.
The Fed's aggressive monetary stimulus to promote US job creation, investment and consumption sent the dollar to a four-month low against a basket of currencies.
The franc rose to its strongest since May against the greenback, touching $ 0.9313 on trading platform EBS.
After the Swiss National Bank set a cap of 1.20 on the safe-haven franc to stave off deflation and a recession, for months the franc traded close to the 1.20 central bank intervention mark.
But the Swissie has been on a weakening trajectory since the start of September, with the European Central Bank's plan to buy bonds and a key German court ruling fuelling hopes among market players the crisis may be easing.
SNB Chairman Thomas Jordan said in a radio interview that despite signs of a de-escalation, the cap of 1.20 on the franc was still the right policy tool and that it was as yet too early to talk of any sort of exit.
The franc was down 0.1 percent against the euro compared to the New York close, trading at 1.2156 at 0646 GMT, off an intra-day low of 1.2176, its weakest since January 6.
Commerzbank analysts Lutz Karpowitz and Ashley Davies said were sceptical whether this softness would last.
"For that we'd have to see lasting positive sentiment and a real solution to the debt crisis. The air should get thin for euro-Swiss around 1.22," they said.
The franc rose 0.3 percent against the dollar to 0.9326.
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