The Swiss franc fell to a fresh 8-1/2-year low against the euro in early Thursday trading ahead of the European Central Bank's policy meeting, where the central bank is expected to prepare the ground for another rate hike in June.
The franc traded 0.1 percent lower against the euro at 1.6417 per euro after having hit a fresh 8-1/2-year low at 1.6452 per euro earlier in the session.
Against the dollar, the franc was 0.1 percent higher at 1.2196 per dollar. The ECB is widely expected to hold rates steady at 3.75 percent at its meeting later in the day, but many market players expect hawkish rhetoric from ECB President Jean-Claude Trichet at the news conference following the decision, indicating a rate increase in June.
"The euro-franc has broken up through the 1.63 mark to decade-long highs as risk appetite returned to markets in full force, equities rallied and downward pressure on the funding currencies resumed," analysts at Credit Suisse said in a note.
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