Swiss exporters less gloomy as currency concerns ease -survey

* Credit Suisse export barometer at -0.86 in Q4

* 5 out of 8 sectors see exports on growth trajectory

* Fewer firms see franc strength hitting exports

ZURICH, Oct 10 (Reuters) - Swiss small and medium-sized companies are less worried about the strength of the franc than in the previous quarter and most industry sectors expect exports to rise in the fourth quarter, a survey showed on Wednesday.

Swiss exporters have benefited from the cap imposed on the franc at 1.20 per euro a year ago as the central bank aimed to curb the currency's strength although many still see it as overvalued.

The SME export indicator showed 64 percent of companies surveyed at the start of the fourth quarter expect the franc's strength to slow export growth, down from 70 percent in the previous quarter. The index is compiled by Credit Suisse and OSEC, an organisation that promotes Swiss foreign trade.

After months of testing the 1.20 limit as the euro zone crisis flared, the franc has weakened in recent weeks to trade at around 1.21 per euro.

Of the more than 200 firms surveyed, 79 percent said the strong franc was adversely affecting their profit margins compared with 81 percent in the previous quarter, with the metal, precision instruments and electrical engineering industries feeling the biggest squeeze.

Swiss exports have held up relatively well, growing strongly in August despite flagging global growth as companies managed to ride out the impact of the strong franc.

The export barometer, which records foreign demand for Swiss products, improved in the fourth quarter, rising to -0.86, from -0.92 in the previous quarter, and moving further away from the growth threshold of -1.

Five of the eight sectors surveyed see themselves on a growth trajectory at the start of the fourth quarter, up from just three in the previous quarter. They were led by the electrical engineering sector, which expects significant growth this quarter.

The export prospects indicator stood at 56.3 points in the fourth quarter, up from 55.2 points and above the growth threshold of 50 points.

Of the firms surveyed, 34.5 percent expect exports to grow over the coming quarter, while 45.9 percent expect a stagnation and 19.6 percent see exports declining.

(Reporting by Caroline Copley; Editing by Susan Fenton)

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