FOREX-Dollar sinks after strong euro zone data, Swiss bank rule
* Dollar falls vs Swiss franc after new bank regulations
* Euro helped by short squeeze, German and French surveys
* Canadian dollar falls to new 4-1/2-year low, Aussie slumps
By Gertrude Chavez-Dreyfuss
NEW YORK, Jan 23 (Reuters) - The dollar tumbled on Thursday, pressured by strong manufacturing data in the euro zone and new regulations in Switzerland that raised the level of capital banks must hold against their mortgage books, tightening Swiss monetary conditions.
The greenback fell to a one-week low against the euro and Swiss franc. It also fell sharply against the yen, following a weak Chinese manufacturing number. Soft factory data from China sent Asian stocks lower, losses that persisted in Europe and Wall Street and boosted demand for the safe-haven yen.
"With the market of the view that the European Central Bank is going to be conservative when it comes to monetary policy easing, strong manufacturing data just pushes further back the possibility of any unconventional policy, which tends to lift the euro," said Shahab Jalinoos, currency strategist at UBS in Stamford, Connecticut.
Germany's private sector grew at its fastest pace in more than 2-1/2 years in January, while French business activity shrank less than forecast. Continued...