The Swiss franc weakened against the dollar and the euro in the European trading session as risk appetite picks up and investors are looking elsewhere for higher yielding assets. The Swiss currency is perceived as a safe haven asset and increases in value as demand for it rises in times of crisis.
After a market rout in the first half of the week, investors are becoming more confident today as stock markets are moving up along with risk sentiment.
“An improved risk sentiment could reduce safe-haven demand for the Swiss franc, and thereby lead to capital outflows out of Switzerland and weaken the franc,” Marcus Hettinger, head of global forex research at Credit Suisse said in a note.
Meanwhile, yesterday the Swiss National Bank announced it is increasing measures to counter the franc strengthen by increasing liquidity in the money market, hence investors are cautious about buying up the Swiss currency.
EURCHF climbed up to 1.0467 from an Asian low of 1.0251 by 07:50 GMT. USDCHF rose to 0.7346 from the Asian low of 0.7238.