BLBG: Swiss Franc Climbs to Near Four-Week High Versus Dollar on Safety Demand
The franc traded near the strongest level against the dollar in four weeks as concerns over the civil unrest in Egypt spurred demand for the perceived safety of the Swiss currency.
The franc pared its gains against the dollar amid signs the Swiss economic recovery is losing some momentum. Retail sales fell 0.4 percent in December from a year earlier when adjusted for inflation after increasing 1.8 percent in the previous month, the Federal Statistics Office said today. Egypt’s President Hosni Mubarak offered to negotiate with an opposition movement that plans to force him out of office by bringing a million people onto the streets today.
“The franc is being driven by external issues,” said Geoffrey Yu, a London-based foreign-exchange strategist at UBS AG in London. “The market is waiting for the Egypt situation to unfold, so there’s a safe-haven issue there. Domestic data more than often only has a secondary impact on the franc.”
The franc appreciated as much as 0.5 percent against the dollar before trading 0.3 percent stronger at 94.14 centimes as of 9:54 a.m. in London. It reached 93.69 yesterday, the strongest since Jan. 4.
The franc weakened 0.1 percent to 1.2943 per euro, after appreciating earlier to 1.2908. It reached 1.2781 yesterday, the strongest in almost two weeks.
A separate report showed Swiss manufacturing growth slowed in January. The SVME Purchasing Managers’ Index fell to 60.5 from a revised 61.2 in December when adjusted for seasonal swings, Zurich-based Credit Suisse Group AG said today. It had previously reported a December figure of 59.6. A reading above 50 indicates growth.
The Swiss currency, perceived as a haven in times of economic turmoil, strengthened last year as euro-region governments struggled to contain the region’s fiscal crisis.
The franc has depreciated 2 percent this year against a basket of nine developed-nation currencies, according to Bloomberg correlation-weighted currency indexes, paring its gain over the past 12 months to 6.9 percent.
To contact the reporter on this story: Keith Jenkins in London at Kjenkins3@bloomberg.net
To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net
The franc traded near the strongest level against the dollar in four weeks as concerns over the civil unrest in Egypt spurred demand for the perceived safety of the Swiss currency.
The franc pared its gains against the dollar amid signs the Swiss economic recovery is losing some momentum. Retail sales fell 0.4 percent in December from a year earlier when adjusted for inflation after increasing 1.8 percent in the previous month, the Federal Statistics Office said today. Egypt’s President Hosni Mubarak offered to negotiate with an opposition movement that plans to force him out of office by bringing a million people onto the streets today.
“The franc is being driven by external issues,” said Geoffrey Yu, a London-based foreign-exchange strategist at UBS AG in London. “The market is waiting for the Egypt situation to unfold, so there’s a safe-haven issue there. Domestic data more than often only has a secondary impact on the franc.”
The franc appreciated as much as 0.5 percent against the dollar before trading 0.3 percent stronger at 94.14 centimes as of 9:54 a.m. in London. It reached 93.69 yesterday, the strongest since Jan. 4.
The franc weakened 0.1 percent to 1.2943 per euro, after appreciating earlier to 1.2908. It reached 1.2781 yesterday, the strongest in almost two weeks.
A separate report showed Swiss manufacturing growth slowed in January. The SVME Purchasing Managers’ Index fell to 60.5 from a revised 61.2 in December when adjusted for seasonal swings, Zurich-based Credit Suisse Group AG said today. It had previously reported a December figure of 59.6. A reading above 50 indicates growth.
The Swiss currency, perceived as a haven in times of economic turmoil, strengthened last year as euro-region governments struggled to contain the region’s fiscal crisis.
The franc has depreciated 2 percent this year against a basket of nine developed-nation currencies, according to Bloomberg correlation-weighted currency indexes, paring its gain over the past 12 months to 6.9 percent.
To contact the reporter on this story: Keith Jenkins in London at Kjenkins3@bloomberg.net
To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net
