The Swiss franc firmed against the euro and dollar on Thursday as economists saw positive news from a Swiss consumer sentiment report despite a decline in the headline figures. The Swiss currency was 0.1 percent higher against the dollar at 1.1949 per dollar.
The franc rose to its highest level against the US currency in more than two years on Monday at 1.1817 per dollar. The franc was 0.2 percent higher against the euro at 1.6466 francs per euro.
The Swiss consumer sentiment index fell to +15 points in the third quarter from +20 points in the second quarter, said the State Secretariat for Economic Affairs. "Optimism declines, but is still on a very high level," said Alessandro Bee, an economist at bank Sarasin. "Consumer confidence has fallen because interest rates haven risen and inflation has picked up."
The franc has been under pressure in recent months as traders take advantage of Switzerland's relatively low interest rates for risky carry trades, in which they borrow in a low-yielding currency to invest in higher-yielding assets.
As equity markets rise, investors appear to be positioning for a renewed weakening of the Swiss franc, UBS analyst Reto Huenerwadel said in a note to clients. "With investors directly linking the performance to equity markets, euro/franc and franc/dollar funding is back high on the agenda of forex investors," said Huenerwadel said.