May 6 (Bloomberg) -- The Swiss franc climbed to the highest against the euro since the introduction of the common currency in 1999 on speculation the Swiss National Bank relaxed efforts to curb the currency’s advance.
“It’s obvious that the SNB has been in the market recently,” said Marcus Hettinger, a foreign-exchange analyst at Credit Suisse Group AG in Zurich. “It could be that it is now accepting a new level versus the euro. But it still seems to be a managed exchange rate.”
The Swiss franc peaked at 1.4045 per euro before trading at 1.4102 as of 6:20 p.m. in Zurich. Today’s 1.6 percent gain is the biggest advance since Dec. 17, 2008, based on previous closing prices.
The currency was little changed against the euro in the previous three days on speculation the SNB sold the currency to prevent gains that may hamper exporters’ competitiveness.
SNB spokesman Nicolas Haymoz declined to comment on the franc. The Zurich-based central bank started selling francs in March 2009 to ward off deflation and revive the economy.
The euro has lost 7.4 percent of its value this year, according to Bloomberg Correlation-Weighted Currency Indices, dropping on Greece’s deficit turmoil. The franc has decreased 3.2 percent during that period.
“It seems the SNB is letting the market do the work without standing in the way,” said Geoffrey Yu, a currency strategist at UBS AG in London. “The sentiment is against the euro, and investors are selling it, without the SNB buying on the other side.”
Switzerland’s consumer prices increased 1.4 percent in April from a year earlier, matching the fastest pace since November 2008, the Federal Statistics Office reported. The median forecast of 12 economists in a Bloomberg News survey was for a 1.3 percent advance.
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