The Swiss franc weakened against 16 major peers tracked by Bloomberg as investors sought higher- yielding currencies amid confidence policy makers and bankers have staved off a Greek default. The currency slid for a fifth day as a report showed Swiss manufacturing grew at a slower pace. The euro was poised for its first weekly gain in a month versus the dollar after Greek Prime Minister George Papandreou won approval for an austerity plan needed to keep aid flowing and German banks agreed to roll over the Greek bondholdings maturing through 2014. The Dollar Index was set for its biggest weekly decline since January before data forecast to show U.S. manufacturing growth slowed in May. “The Swissie was quite a good safe-haven currency, especially if you wanted to flee the euro because of its short- term risks,” said Ulrich Leuchtmann, head of foreign-exchange strategy at Commerzbank AG in Frankfurt. “With the short-term risks in the euro-zone having abated, this shift should be unwound, and that’s what we’re seeing. We’ll see a weaker Swissie as long as we have no more event risk from the euro zone.” The Swiss franc tumbled 0.8 percent to 1.22844 versus the euro, as of 9:28 a.m. in London. It depreciated 0.7 percent against the dollar to 84.62 centimes. The euro was little changed at $1.4511. It’s set for a 2.3 percent weekly advance versus the dollar, its biggest gain since the five days ending Jan. 14. The European currency climbed 0.3 percent to 117.17 yen. The dollar rose 0.2 percent to 80.74 yen. To contact the reporter on this story: Lucy Meakin in London at lmeakin1@bloomberg.net. To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net.

Source