The franc, which investors buy in times of heightened uncertainty, has risen some 20 percent against the dollar over the past 12 months, buoyed by favourable Swiss economic conditions, concerns about US debts and ultra loose monetary policy in the United States.
The franc jumped to a record high of 0.8595 francs on trading platform EBS against the dollar during the previous session but then weakened slightly as investors booked profits.
But some analysts said there was further room for franc appreciation against the dollar as the Swiss National Bank is likely to tighten monetary policy this year.
"With interest rate spreads now in favour of the franc (measured by 2Y swaps) downside pressure on USD/CHF is likely to persist in the near term," Credit Suisse analyst Marcus Hettinger wrote in a note.
The franc was largely flat against the dollar from Tuesday's close, trading at 0.8621 francs per dollar at 0755 GMT.
Although monetary policy is expected to stay loose in the United States, good growth, low joblessness and a booming real estate market are seen by economists as grounds for an interest rate rise.
Buttressing expectations the Swiss National Bank could raise its target for the 3-month Swiss franc LIBOR in coming months, Chairman Philipp Hildebrand said last Friday inflationary pressures were beginning to emerge due to rising oil and commodity prices.
Interest rate futures for Switzerland show a high chance of a 25 basis point move in September, and fully price in a hike by December.
Meanwhile, the franc fell 0.3 percent against the single currency from Tuesday's close to trade at 1.2801 francs per euro.
Expectations the European Central Bank on Thursday will signal it is prepared to hike interest rates also put pressure on the franc against the euro.
A Reuters poll showed a majority of 76 economists expected the ECB to raise rates next in July.