The Swiss franc weakened versus the euro and dollar after the nation’s central bank said it expanded measures to fight the currency’s “massive overvaluation.” The franc dropped against most of its 16 major peers tracked by Bloomberg after the Swiss National Bank said it will “significantly increase” the supply of liquidity to the money market and expand banks’ sight deposits. The SNB will also conduct foreign-exchange swap transactions as it attempts to curb gains in the Swiss currency caused by investors seeking a haven from the European debt crisis. “Their objective to increase liquidity has given the Swiss franc a decent move,” said Peter Rosenstreich, Geneva-based chief currency analyst at Swissquote Bank SA. “But we think long-term, the swap transactions and increase in the money supply is probably not going to be enough to free up liquidity and really dent the fundamental rationale for why the Swiss continues to appreciate. There’s just massive concern in Europe, and people want to be holding Swiss francs.” The franc weakened 0.5 percent to 1.04135 per euro as of 8:46 a.m. in London, after approaching parity with the 17-nation currency yesterday. The currency depreciated 0.6 percent to 72.49 centimes against the dollar, reversing earlier gains. 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

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