Switzerland's exports rose in June, partly due to an increase in sales of chemical and pharmaceutical products, the largest export category, data from the Federal Customs Office showed. A cap on the Swiss franc imposed by the central bank almost three years ago has helped protect exporters, but weak demand Europe, the country's largest trading partner, continues to drag on sales. Exports rose an inflation-adjusted 2.2 percent year-on-year in June to 16.866 billion Swiss francs ($18.8 billion), or 1.2 percent on a nominal basis, the data showed. The rise was driven mainly by exports of pharmaceuticals and chemicals, which rose a nominal 2.4 percent. But sales of machines and electronic devices, the second-largest export category, were down 1.7 percent. Exports to Europe slipped by 1.2 percent in June on the same basis. Weak growth in the European Union is expected to curb the momentum of Switzerland's export-powered economy and has led the government to trim its latest forecasts for economic growth for this year and 2015. Exports of watches rose a nominal 1.4 percent in June to 1.9 billion francs and all main price segments showed a positive trend both in value and volume terms, the Federation of the Swiss Watch Industry (FH) said. Watchmakers are grappling with an unfavourable currency environment and sluggish demand for high-end watches in the important Chinese market, where a crackdown on gifts for favours has hurt watch sales. Swatch Group, the world's largest watchmaker, said on Tuesday the strong Swiss franc weighed on its first-half net profit but it expected a positive second half on good demand in the United States and Japan. The trade surplus narrowed to 1.4 billion francs in June from a revised 2.8 billion a month earlier. (Reuters)