(Recasts, adds details, updates prices)
* Swiss franc climbs as euro zone debt concerns build again
* Dollar undermined by dovish Fed minutes, QE speculation
* German govt moves on EFSF support euro
By Anirban Nag
LONDON, Aug 31 (Reuters) - The Swiss franc rose against the euro and the dollar on Wednesday as investors piled back into the currency, with euro zone debt worries and speculation about easing in the U.S. keeping alive the risk of intervention by the Swiss National Bank.
The single currency dropped more than 1.5 percent to a session low of 1.1631 francs on trading platform EBS, while the dollar fell to a low of 0.8057 francs , retreating from a recent high of 0.8239 struck on Monday. Traders cited Swiss franc buying by U.S. and Swiss investors.
Analysts said some investors were taking profits after the euro failed to break through 1.2000 francs earlier this week, while the Swiss franc looked oversold on daily charts, having hit its lowest level since early July on Monday.
A German cabinet decision that set policymakers on course for parliamentary ratification of changes to the euro zone's bailout fund helped push the single currency briefly to a session high of $1.4470 versus the dollar .
But it was last flat on the day at $1.4440 as it ran into selling by macro and real money investors. Traders said month-end demand for dollars from investors rebalancing their stock and bonds portfolio was weighing on the euro and cited small sell orders starting from $1.4480.
Lukewarm demand at an Italian bond auction on Tuesday and signs of backtracking on Rome's budget changes weighed on the euro, reigniting worries over the enormous debt burden facing the euro zone's third largest country.
"The difficulty the market has at the moment is finding a reason to buy any currency. The euro zone has got a peripheral problem, the U.S. has got a potential QE problem," said Daragh Maher, deputy head of FX research at Credit Agricole.
"The Swiss franc remains a safe play. If numbers do not improve, people remain nervous and the euro zone situation remains grim we can expect to see the franc strengthen again."
Minutes from the U.S. Federal Reserve's Aug. 9 meeting showed policymakers discussed a range of unusual tools they could use to help the economy, adding to expectations the Fed may flag a third round of quantitative easing at its two-day meeting in September.
Moves to inject more liquidity into the U.S. economy would undermine the greenback and analysts said speculation was likely to keep the dollar weak in the run-up to the meeting. On Wednesday, the private sector ADP report will be released ahead of the Chicago ISM data for August .
More weak data after U.S. consumer crumbled to a two-year low on Tuesday is likely to add to speculation for more quantitative easing. On the other hand, a positive surprise could give riskier assets a slight boost.
FRANC DEMAND
Despite stock markets bouncing on Wednesday, demand for the safe-haven Swiss franc returned with the Swiss National Bank conspicuous by its absence from the forward market since last week.
Its intervention in the swap market and moves to flood the Swiss banking system with francs and cut interest rates to near zero has toppled the Swiss franc from record highs hit earlier this month.
As a result, the dollar is on track for its best monthly performance against the franc since May 2010, and the euro for its best since January 2011. The euro was last down 1.3 percent at 1.1684 as was the dollar at 0.8086 francs.
In the options market, one-month euro/Swiss vols edged higher to 17 percent on Wednesday, indicating investors expect further strong moves in the Swiss franc as concerns over a global growth slowdown persist.
"The liquidity injection is close to an end in terms of new money coming in, which means Swiss franc weakness is likely to (end).... The SNB will have to intervene more aggressively from now on," said George Saravelos, FX strategist at Deutsche Bank.
The dollar dipped 0.2 percent to 76.55 yen , but was seen supported by bids around 76.50 yen from Asian players.
With the yen hovering near a record high against the dollar of 75.941 hit earlier in August on trading platform EBS, market players remain wary of the potential for Japanese authorities to intervene to sell the yen. Japan's Ministry of Finance said on Wednesday that the authorities had conducted a total of $58.8 billion in forex intervention in the month to August 29.
(additional reporting by Nia Williams; Editing by John Stonestreet)