LONDON, Sept 30 The safe-haven Swiss franc fell
sharply on Friday, having earlier hit a two-month high on
worries about the European banking sector, with some traders
speculating that the Swiss central bank was intervening to cap
the currency's strength.
The euro had hit a two-month low of 1.08125 francs
earlier in the London session, as concerns about the health of
Deutsche Bank weighed on the single currency and undermined risk
appetite across global markets.
But by 0958 GMT it had rebounded to hit a one-week high of
1.09135 francs, rising 0.4 percent in a matter of minutes. It
was last trading at 1.0874 francs, still up 0.3 percent on the
day, while the single currency was broadly weaker against most
The Swiss National Bank often intervenes by selling francs
and buying the euro in order to cap the currency's strength,
The dollar climbed 1 percent to a 9-day high of 0.9770
francs, having hit a one-month low on Thursday. The Swiss
franc was bolstered by expectations that Middle Eastern
investment houses could pull out money of the United States and
into alternative safe-haven liquid currencies like the franc.
Those expectations got a boost after the U.S. Congress voted
overwhelmingly on Wednesday to approve legislation that will
allow the families of those killed in the Sept. 11, 2001 attacks
on the United States to seek damages from the Saudi government.
(Reporting by Anirban Nag; Editing by Jemima Kelly)