Enviado: 26/8/2011 17:25Switzerland’s Franc Extends Decline to 0.9 Percent Against Euro, Dollar
By Lucy Meakin and Anchalee Worrachate - Aug 26, 2011 3:22 PM GMT
The Swiss franc fell against all its major counterparts after an index of leading indicators slid more than economists forecast, adding to signs the currency’s recent strength is damaging the nation’s growth.
The franc extended a third weekly loss against the euro, the longest losing streak since October, on speculation the Swiss National Bank will step up its campaign to counter the currency’s gains this year. The franc briefly pared losses versus the dollar after Federal Reserve Chairman Ben S. Bernanke stopped short of announcing another round of monetary stimulus for the U.S. at a speech today.
The economic gauge “shows that the strong Swiss franc is having a negative impact on the economy,” said Marcus Hettinger, a foreign-exchange strategist at Credit Suisse Group AG in Zurich. “We need a stable external environment in Europe and the U.S. for safe-haven demand to fall a little bit, so the Swiss franc can weaken.”
The franc dropped 0.3 percent to 1.1431 per euro at 3:15 p.m. in London, having lost 1.2 percent this week. The currency fell 0.4 percent to 79.65 centimes per dollar, on course for a 1.5 percent decline this week
The monthly gauge that aims to predict the Swiss economy’s direction about six months ahead fell to 1.61 for August from a revised 1.98 in July, the KOF Swiss Economic Institute said today. Economists forecast a decline to 1.8, according to the median of 14 estimates in a Bloomberg News survey.
SNB Measures
The franc also depreciated as investors bet the SNB will take additional steps to weaken the currency.
The central bank boosted liquidity in money markets and increased the cash available to banks after the franc’s appreciation made the nation’s exports less competitive. The Swiss manufacturers’ association Swissmem said this week the country may face serious economic damage unless a “clear weakening” of the currency begins soon.
Bernanke said the U.S. central bank still has tools to stimulate the economy without providing details or signaling when or whether policy makers might deploy them.
“In addition to refining our forward guidance, the Federal Reserve has a range of tools that could be used to provide additional monetary stimulus,” he said in a speech in Jackson Hole, Wyoming.
Switzerland’s currency has strengthened 12 percent this year, the best performer among a basket of the currencies of 10 developed nations, according to Bloomberg Correlation-Weighted Currency Indexes.
Swiss government bonds rose, pushing 10-year yields down seven basis points to 1.01 percent.
By Lucy Meakin and Anchalee Worrachate - Aug 26, 2011 3:22 PM GMT
The Swiss franc fell against all its major counterparts after an index of leading indicators slid more than economists forecast, adding to signs the currency’s recent strength is damaging the nation’s growth.
The franc extended a third weekly loss against the euro, the longest losing streak since October, on speculation the Swiss National Bank will step up its campaign to counter the currency’s gains this year. The franc briefly pared losses versus the dollar after Federal Reserve Chairman Ben S. Bernanke stopped short of announcing another round of monetary stimulus for the U.S. at a speech today.
The economic gauge “shows that the strong Swiss franc is having a negative impact on the economy,” said Marcus Hettinger, a foreign-exchange strategist at Credit Suisse Group AG in Zurich. “We need a stable external environment in Europe and the U.S. for safe-haven demand to fall a little bit, so the Swiss franc can weaken.”
The franc dropped 0.3 percent to 1.1431 per euro at 3:15 p.m. in London, having lost 1.2 percent this week. The currency fell 0.4 percent to 79.65 centimes per dollar, on course for a 1.5 percent decline this week
The monthly gauge that aims to predict the Swiss economy’s direction about six months ahead fell to 1.61 for August from a revised 1.98 in July, the KOF Swiss Economic Institute said today. Economists forecast a decline to 1.8, according to the median of 14 estimates in a Bloomberg News survey.
SNB Measures
The franc also depreciated as investors bet the SNB will take additional steps to weaken the currency.
The central bank boosted liquidity in money markets and increased the cash available to banks after the franc’s appreciation made the nation’s exports less competitive. The Swiss manufacturers’ association Swissmem said this week the country may face serious economic damage unless a “clear weakening” of the currency begins soon.
Bernanke said the U.S. central bank still has tools to stimulate the economy without providing details or signaling when or whether policy makers might deploy them.
“In addition to refining our forward guidance, the Federal Reserve has a range of tools that could be used to provide additional monetary stimulus,” he said in a speech in Jackson Hole, Wyoming.
Switzerland’s currency has strengthened 12 percent this year, the best performer among a basket of the currencies of 10 developed nations, according to Bloomberg Correlation-Weighted Currency Indexes.
Swiss government bonds rose, pushing 10-year yields down seven basis points to 1.01 percent.
