Switzerland’s Franc Pares Decline Against Dollar Before SNB Cap Decision
Switzerland’s franc pared losses that saw it depreciate to a nine-month low against the dollar as investors bet the nation’s central bank will refrain from weakening the currency at its meeting tomorrow.
The franc fell to 94.78 centimes, matching yesterday’s decline to the weakest level versus the greenback since Feb. 22. Swiss National Bank policy makers, led by Philipp Hildebrand, will keep the franc’s minimum exchange rate at 1.20 per euro when they meet in Zurich tomorrow, according to nine of 13 economists surveyed by Bloomberg.
“People are waiting for the results of tomorrow’s meeting,” said Bernd Berg, a currency strategist at Credit Suisse AG in Zurich. “Our basic scenario is that they will not raise the floor but we would not be surprised if it was, based on recent weak economic data.”
The franc was little changed at 94.48 centimes per dollar at 9:12 a.m. London time. The currency was also little changed against the euro, at 1.2330.
The Swiss currency has weakened 3.8 percent in the past three months, paring its gain for the year to 0.6 percent, according to Bloomberg Correlation-Weighted Indexes, which track 10 developed-nation currencies. The SNB set the ceiling against the 17-nation euro on Sept. 6 as investors bought the franc as a haven amid the euro-area sovereign-debt crisis.
Swiss consumer prices fell 0.5 percent in November, the Federal Statistics Office in Neuchatel said Dec. 6, the biggest drop since October 2009. The country’s economy grew 0.2 percent in the third quarter, the slowest pace in more than two years, the State Secretariat for Economic Affairs said Dec. 1.
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