Swiss National Bank resumed interventions in second quarter - on a small scale

* Swiss reserve assets increased by 8.9 billion francs in Q2

* Increase shows the SNB trying to moderate franc strengthening

* Swiss Q2 current account surplus widens to 10.5 billion francs (Rewrites, adding analyst, central bank comment)

By John Revill

ZURICH, Sept 22 (Reuters) - The Swiss National Bank appeared to increase its foreign currency interventions during the second quarter, although the level of purchases was far lower than a year earlier, when it was fighting to stop the Swiss franc from appreciating too much.

Switzerland's reserve assets - which includes foreign currency purchases by the SNB - increased by 8.9 billion Swiss francs ($9.65 billion), higher than the 1.47 billion franc rise during the first quarter, according to balance of payments information published on Wednesday by the central bank.

But the figure was far lower than the 57.2 billion franc increase in reserve assets during the second quarter of 2020, as the SNB battled appreciation pressures on the safe-haven franc during the height of the COVID-19 pandemic.

The SNB, which holds its quarterly monetary policy review on Thursday, declined to comment.

Analysts have said the reduced rate of interventions showed the SNB's more accepting attitude to the franc's strength, driven by inflows into Switzerland's defensively dominated stock market.

During the second quarter, non-residents spent 9.16 billion francs on Swiss equity and debt securities, driving demand and the valuation of the franc.

"From looking at the increase in reserve assets, the SNB appears to have tried to moderate this trend with increased interventions," said Karsten Junius, an economist at J.Safra Sarasin.

The SNB appears to have scaled back interventions again, with sight deposits that commercial banks hold at the SNB - another proxy for SNB forex purchases - rising only by 3 billion francs during July and August, Junius added.

"It seems they now want to manage and slow the rise of the franc rather than block it with massive interventions," he said.

Switzerland's economy seems to be able to cope with a nominally stronger franc, Junius added, with data on Wednesday showing the current account surplus widening to 10.51 billion francs during the second quarter.

The figure, up from a 3.2 billion franc surplus a year earlier, was mainly due to a higher receipts surplus in the goods trade, the SNB said.

($1 = 0.9242 Swiss francs) (Reporting by John Revill; Editing by Kevin Liffey and Catherine Evans)

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