The euro was boosted yesterday by a surprise large rise in interest rates by the Swiss authorities.

The value of the currency was also underpinned by news that European Central Bank (ECB) vice president, Mr Christian Noyer, had said he expected the euro to rally soon against the dollar and that intervention in the currency markets was a tool available to the ECB.

The euro closed at $0.9694 from $0.9606 on Wednesday. The euro earlier rose to $0.9700/05, putting more distance between Wednesday's $0.9573 trough - its lowest since March 8th.

The Swiss raised rates by a surprise 0.75 of a percentage point. According to Mr Aziz MacMahon, economist at Ulster Bank, traders are now expecting another interest rate rise from the ECB sooner than otherwise.

Mr Noyer said the ECB's interest rate increases, most recently a quarter of a percentage point increase on March 16th, were "sufficient to address the risks and pressures we had identified so far". But according to Mr MacMahon the euro is unlikely to appreciate and another rate rise will be needed by April. "The weakness of the euro means that even with higher rates, monetary policy is more accommodative than it was last year," he said.