The Swiss franc pushed towards parity against the dollar on Monday and traded flat against the euro as investors eyed key macroeconomic data due out later in the week. Data due on Thursday is expected to show US gross domestic product grew 3.3 percent in the third quarter, and could support the contention that the US Federal Reserve may raise interest rates sooner than previously expected.
A rise in rates would support the US dollar, whose low yield has put it under significant pressure with respect to other major currencies in recent months. Swiss consumer data due Tuesday is expected to improve from last month's reading, although it is likely to remain below its long-term average, a weakness in an economy that has proved otherwise resilient during the financial crisis.
The franc was little changed against the euro compared to the New York close, trading at 1.5133 per euro. The franc was 0.2 percent higher against the dollar at 1.0069 per dollar. UBS economist Reto Huenerwadel said that the euro-franc failed to test the 1.50 mark and with it the SNB's willingness to defend that level.
"Instead the cross (rate) bounced off the lows in line with a slightly stronger dollar-franc exchange rate," said Huenerwadel. "In very technical trading we argue that the psychologically important levels of 1.50 in the euro-franc and at parity in dollar-franc remain a magnet for both the currency pairs," he said.
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