Dollar rises against Swiss franc

The dollar hit a 10-month high against the Swiss franc and also rose to its highest level since October versus the yen on Wednesday as this week's expected US interest rate hike bolstered the greenback's yield appeal.
The Federal Reserve is expected to raise interest rates by a quarter percentage point to 3.25 percent on Thursday. This contrasts with eurozone' borrowing costs which have remained at 2 percent for more than two years and Japan's at almost zero.
The Swiss KOF leading indicator fell to its lowest level since early 2004, further underscoring Europe's sluggish economy.
"(The Fed hike) will highlight the economic outperformance of the United States which will favour the dollar," said Kristjan Kasikov, currency strategist at Calyon.
The dollar had risen to 1.2852 Swiss francs, its highest since August, before trimming gains to 1.2825 by 1130 GMT. Against the yen it had risen 0.4 percent to 110.43 yen, its highest since early October.
The euro was slightly lower at $1.2055 but off last week's 10-month low of $1.1981.
"In order to break $1.20 the momentum has to be very strong and we have no data today to push it through that level," Kasikov said.
The single currency also weathered downgrades in debt ratings outlooks for Italy and Portugal. Ratings agency Fitch cut outlooks for the two eurozone countries to negative due to concerns about public finances.
The KOF indicator, which points to the expected performance of the economy in about six months time, fell unexpectedly to 0.46 in June.
With the market already pricing in a rise in the US cost of borrowing, attention will be on the post-meeting statement for clues on the future path of interest rates.
Analysts expect the Fed would stick to its position of raising interest rates at a measured pace to counter inflation.
"The focus is on the Fed tomorrow. It seems most likely they will reiterate the previous meeting's statement," said Michael Metcalfe, currency strategist at State Street Global Markets.
In the eurozone, policymakers are pressuring the European Central Bank to cut interest rates but so far the central bank has said the current interest rates are appropriate.