Switzerland's economy, although relatively small, produces world-famous household-name products – which are now likely to become more expensive thanks to the sudden appreciation of the Swiss franc.

And while Swiss-Australian trade is limited, local investors will feel the impact as the appreciation adds to Europe's economic woes.

Until Friday, the Swiss franc was a fixed exchange rate, pegged at 1.20 per euro. However, this was an expensive and, it seems, an unsustainable policy to maintain and the Swiss government has decided instead to float the franc. Now it hovers near parity with the euro. On Thursday, one Australian dollar bought 0.82 Swiss francs; now it's about 0.70.

As a result, Swiss exports become more expensive and imports cheaper. The exports include Swiss clocks and watches, of which Swatch and Rolex are the two biggest manufacturers.  Swiss companies are big producers of precision-engineered items, Logitech computer mouses are exported globally, and Roche produces global drug brands like valium.

Other big-name Swiss companies include pharmaceutical group Novartis and chocolate manufacturer Lindt. The latter owns 16 chocolate cafes in Australia, including four in Melbourne. Multinationals like miner Glencore and food-processing giant Nestle are headquartered in Switzerland, although most of their business is done outside the country.

Then there are the Swiss banks, in which foreigners have been parking their money for decades. The Swiss maintained neutrality through both world wars, are not members of the European Union, and were not even members of the United Nations until 2002. This well-earned reputation for independence and national sovereignty has fostered a thriving banking industry. More than a quarter of all funds held outside the country of origin – also known as offshore funds – are kept in a Swiss bank.

Swiss banks derive much of their earnings overseas, which translates into lower reported earnings in francs, and have a greater share of costs in francs. The appreciation has sent shares in Switzerland's two big banks, UBS and Credit Suisse, slumping as much as 15 per cent.

Swiss tourism, based primarily on the Alps, is also a big money-spinner. More than three-quarters of visitors are from Switzerland, the rest from  Europe or the United States. Australians make up less than 1 per cent of visitors.

However, sellers of Swiss products overseas, including in Australia, would do their best to limit the price increases, said Commsec chief economist Craig James. "They will do their best to absorb that because it is still a fairly tough retail environment and we have significant global competition. If goods become more expensive, consumers jump on the internet to see if they can do something better. But the magnitude of the depreciation makes it much more difficult for businesses to absorb it, yes."

All tourists – including Europeans and Australians – will now find Switzerland a more expensive destination. Conversely, the Swiss have automatically gained extra purchasing power in Europe.

Flight centre spokesman Haydn Long said, however, that tourists' travel plans were not usually affected by swings in the currency. Switzerland was not a significant tourist destination for Australia, he said, although many European coach tours often stopped there as part of the itinerary.

What does all this mean for the Australian economy? According to the most recent data from the Department of Foreign Affairs and Trade, Switzerland was Australia's fifth-largest source of foreign direct investment ($23 billion) and sixth-largest investor overall ($49 billion). Swiss companies Glencore, Novartis, Roche, Nestle, SGS, ABB, Holcim, Credit Suisse, Zurich and UBS all have a base in Australia, while Australian companies Macquarie Group and CSL Behring have a presence in Switzerland.

However, Switzerland is not a  big trading partner of Australia and is well outside the top 15 countries exporting and importing here. Australia exported $681 million of goods to Switzerland (mostly jewellery, gold, meat and pharmaceutical products) and imported $2.89 billion of goods (medical treatments, gold, watches and clocks). Australia exported $656 million of services to Switzerland and imported $1.16 billion of services.

Probably the biggest Australian impact would be on local investors. It was yet another source of uncertainty in a very uncertain global investing environment, said Mr James. "It's creating a fresh source of uncertainty. It's another reason for investors to say, 'It's all too difficult at the moment, I'm staying on the sidelines'."