The franc has spent much of the last year trading in tandem with the euro after the Swiss National Bank set a cap of 1.20 per euro on Sept. 6, 2011 to stop the soaring safe-haven currency triggering a recession and deflation.

After the European Central Bank's bond buying programme eased tension in the euro zone, worries have flared again about Spain, which is due this week to present its draft budget for 2013 and outline new structural reforms for the economy.

"It is only a matter of time before markets lose patience and force Spain to formally request a bailout," said Sireen Harajli of Credit Agricole.

"We view this as a EUR positive outcome, but until then we expect that EUR/USD will continue to drift lower."

As the euro hovered near two-week lows, the franc fell 0.3 percent against the dollar to trade at 0.9373 by 0622 GMT compared to the New York close.

The franc was flat against the euro at 1.209.

The SNB denied on Tuesday a report by Standard & Poor's that the central bank had bought about 80 billion euros ($103.7 billion) of bonds issued by Germany, France, the Netherlands, Finland and Austria between January and July.

The SNB said S&P had ignored a big increase of SNB deposits with other central banks and international institutions, which form part of its sovereign bond allocation.

The S&P report had said that the bond purchases are part of the reason for yields for "core" euro zone bonds sinking close to record lows while borrowing costs for other euro zone states remain high.

"The S&P's report overstates the likely SNB purchases of core eurozone sovereign bonds by roughly 45-50 billion euros, thus also the impact on bond prices," said Credit Suisse economist Maxime Botteron.

In a speech on Tuesday, SNB Chairman Thomas Jordan said it too early to say that the euro zone's debt crisis has started to subside despite signs of market stress easing, reiterating his commitment to defend the upper limit on the franc.