The Swiss franc weakened against most major currencies in the early European session on Thursday, after data showed that Switzerland's inflation remained negative in September.
Data from the Federal Statistical Office showed that consumer prices declined 0.2 percent year-on-year in September, following a 0.1 percent drop in August. Prices were expected to remain flat in September. Prices have been falling since late 2014.
On a monthly basis, consumer prices edged up 0.1 percent, offsetting a 0.1 percent drop a month ago. This was the first rise in three months but slightly slower than the expected 0.2 percent increase.
In other economic news, the KOF Swiss Economic Institute said the economy is returning to moderate growth, which will in turn would assist a slow recovery in labor market.
In the Autumn Forecast, the think tank said gross domestic product is set to rise 1.6 percent this year and 1.8 percent in 2017. In 2017, inflation will rise above the zero mark, albeit very slowly.
In the Asian trading today, the Swiss franc held steady against its major rivals.
In the European trading, the Swiss franc fell to 1.0939 against the euro and 1.2435 against the pound, from an early 2-day high of 1.0911 and more than a 5-year high of 1.2396, respectively. If the Swiss franc extends its downtrend, it is likely to find support around 1.10 against the euro and 1.27 against the pound.
Against the U.S. dollar, the franc dropped to 0.9779 from an early high of 0.9735. The franc may test support near the 0.98 area.
Meanwhile, the Swiss franc rose to 106.28 against the yen, from an early low of 105.99. The franc is likely to find resistance around the 107.00 region.
Looking ahead, at 7:30 am ET, the European Central Bank is scheduled to issue the minutes of the monetary policy meeting of the governing council held on September 8.
In the New York session, Canada building permits for August, and U.S. jobless claims for the week ended October 1 are set to be published.
At 10:50 am ET, European Central Bank Board member Ignazio Angeloni is expected to speak at The Netherlands Days organised by De Nederlandsche Bank in Amsterdam.
At 11:50 am ET, Bank of Canada Senior Deputy Governor Carolyn Wilkins is expected to speak at the University of Quebec in Trois-Rivieres, Quebec.
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