The Swiss franc advanced to the strongest level in seven months against the euro as investors weighed improving economic data before the nation’s central bank meets this week.
The currency rose against 14 of its 16 major counterparts before the Swiss National Bank, which imposed a cap of 1.20 francs per euro in 2011, announces its next policy decision on Thursday. The Swiss economy expanded 0.5 percent in the third quarter, compared with euro-region growth of 0.1 percent, while a report last week showed consumer prices unexpectedly climbed in November from a year earlier, the first annual increase since September 2011.
“You have a relative growth play that favors the Swissie over the euro,” said Peter Rosenstreich, chief foreign-exchange analyst at Swissquote Bank SA in Geneva. “Markets are positioned for a boring SNB meeting Thursday with no change in band and total commitment to the main exchange rate, yet the data continues to improve. There is potential we could see an adjustment to the SNB’s overly weak inflation forecasts.”
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