The Swiss franc held steady against the dollar on Monday after the Swiss National Bank's decision last week to leave interest rates unchanged and ahead of a US Federal Reserve policy meeting later this week. The dollar changed hands at 1.1675/81 Swiss francs in early European trading on Monday, at similar levels from Friday's 1.1676/80. The euro traded at 1.5485/94 francs, down from 1.5506/11 on Friday.
This week, markets will be watching to see if the Fed will move away from its policy of a "measured" increase in interest rates and towards a more aggressive policy in the future.
Higher US interest rates would draw more liquidity into dollar-denominated deposits and thereby strengthen the currency. The Fed has raised rates by a quarter point at each of its last six meetings, taking the federal funds rate to 2.5 percent.
Last Thursday, the SNB left interest rates unchanged as expected, and signalled it was in no rush to raise them until an economic recovery picks up steam.
The Swiss economy contracted slightly in the final quarter of last year and the growth outlook in the euro zone, which buys the bulk of Swiss exports, is also uncertain.
Against that backdrop, the SNB said it will keep its target band for the three-month Swiss franc LIBOR rate unchanged at 0.25 to 1.25 percent, and will continue to aim for the mid-point of that range, or 0.75 percent.