Strong franc sends Swiss economy into reverse

Safe haven Switzerland felt the chill touch of the eurozone's woes between April and June as the crisis sent its economy into a shock reverse, official figures showed yesterday.

Switzerland's output shrank 0.1 per cent in the second quarter, disappointing hopes of modest growth. The economy's performance between January and March was also revised down from earlier estimates.

The nation is feeling the squeeze from lower exports as its currency is inflated by the influx of billions seeking shelter from the euro in the Swiss franc. The figures supported the case for the Swiss National Bank (SNB) to maintain the €1.20 cap on the "Swissie" it imposed a year ago.