The Swiss franc firmed on the dollar early on Wednesday after the greenback pared gains in the wake of last week's surprisingly strong U.S. jobs report that had taken the Swiss unit to close to five-week lows. Dealers said the franc also benefited from investors shifting funds into the relative safety of the Swiss currency ahead of the long Easter weekend, especially in view of the escalating violence and the rising death toll in Iraq. The dollar eased to 1.2910/15 francs from 1.2968/78 in Europe late on Tuesday, while the euro slipped to 1.5603/07 francs from 1.5644/49 as long euro positions were unwound.
Dollar sentiment continued to be underpinned by expectations that U.S. interest rates could start moving higher from their current low of one percent sooner rather than later. This has fuelled talk in the Swiss market that the Swiss National Bank could be ready to shift too to a tightening bias after over a year of record low interest rates. Swiss data also show a recovery is gathering pace as export sales pick up. Currency strategists at UBS said cash inflows into Europe benefited the franc which could rise to 1.24 to the dollar one month from now.//