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TABLE-Swiss sight deposits fall for third week

ZURICH, Oct 8 (Reuters) - The amount of cash commercial banks hold with the Swiss National Bank slipped last week for the third week running, data showed on Monday.

The level is partly a measure of how inclined banks are to find an ultra-safe home for their money and may also reflect efforts by the SNB to defend the 1.20 per euro cap it imposed on Sept. 6, 2011 on the soaring safe-haven Swiss franc.

Sight deposits of domestic banks:

Week ending Amount in Sfr millions October 5 291 041 September 28 291 245 September 21 292 305 September 14 294 152 September 7 291 114 August 31 288 959 August 24 286 375 August 17 280 585 August 10 277 537 August 3 277 299 July 27 270 923 July 20 261 399 July 13 249 281 July 6 245 161 June 29 237 835 June 22 227 955 June 15 212 508 June 8 194 607 June 1 185 408 May 25 170 071 May 18 155 850 May 11 150 900 May 4 153 604

Sight deposits are the accounts of commercial banks with the central bank, and constitute a large part of the liquidity in the banking system. They are seen as an early proxy for how much the SNB is having to spend to defend the franc cap.

As part of its efforts to weaken the franc, the SNB began flooding the money market with cash last August and raised total sight deposits to 200 billion francs, before capping the franc against the euro a month later.

The SNB's tools for expanding sight deposits are foreign exchange swaps and repurchases of its own debt.

(Reporting by Catherine Bosley)

((catherine.bosley@thomsonreuters.com)(+41 58 306 7461))

Keywords: SWISS SNB/SIGHTDEPOSITS