The US dollar tumbled to a new all-time low against the Swiss franc on Thursday, as the greenback was dragged down across the board, on concerns over US debt.

USD/CHF hit a fresh all-time low of 0.8810 during European trading, before consolidating at 0.8823, dropping 0.65 percent.

S&P on Monday cut its outlook on the US from ‘stable’ to ‘negative’ citing nation’s very large budget deficit and rising indebtedness.

Analysts said that the greenback is also weighed down by the concerns that Federal Reserve will lag behind other central banks in raising the interest rates.

Also, the Swissie found support from the speculations over interest rate hike by the Swiss National Bank (SNB) in the coming months, after the central bank revised the growth forecast upwardly for the year earlier this month.

However, the Swiss franc traded lower against the euro, with EUR/CHF gaining 0.14 percent to hit 1.2914.The single currency was supported by the heightened risk appetite for the high-yielding currencies.

Meanwhile, the British pound surged to a 16-month high against the US dollar, after official data showed UK retail sales rose unexpectedly in March and public sector borrowing remained below the government’s target for the fiscal year ending March. GBP/USD rose to the highest level since December 2009 hitting 1.6564 during early European trading.

Earlier on Thursday, the dollar index, a measure of performance of the greenback against a basket of six major currencies, fell to 73.873, it’s weakest since August 2008.