The Swiss franc lost ground against the dollar on Thursday as a return of risk appetite pushed stock markets higher. European bourses looked set to follow stocks in the United States, where the Dow Jones industrial average notched up its biggest percentage gain in nearly five years on Wednesday.
The comments suggesting further interest rate cuts in the US "Stock markets are a kind of benchmark for the carry trade currencies," said Unicredit analyst Armin Mekelburg. "Markets have rediscovered some risk appetite for carry trades," he said. "But I would not expect this to last for too long because financial markets remain fragile."
The franc was 0.2 percent higher against the dollar at 1.1131 compared to the New York close, moving off the record high of 1.0899 hit last week. Against the euro, the franc was little changed 1.6486 per euro, compared to the New York closing price, after losing around half a percent on Wednesday.
The franc has long suffered from carry trades, in which investors make use of low Swiss interest rates and borrow the franc to invest it in higher-yielding currencies.
Markets attention will turn to Swiss consumer price data for November and third-quarter growth figures, both due on Friday, to see whether the Swiss National Bank will have to increase interest rates further.