* EU/IMF to release key loan tranche to keep Greece afloat-Rehn * Uncertainty over second aid package keeping markets on edge * Merkel/Sarkozy talks on Greece aid impasse eyed By Hideyuki Sano and Ian Chua TOKYO/SYDNEY, June 17 (Reuters) - The euro fell on Friday, inching closer to a three-week low versus the dollar on worries on how policy makers will tackle Greece's debt crisis with no apparent solution in sight. Investor risk appetite also waned as share prices across Asia slumped and after weak U.S. regional manufacturing data cemented concerns about a soft patch in the U.S. economy. "For investor risk appetite to come back, we'll need a recovery in U.S. economic data and the prospect of an end to Greece's debt crisis. None of which is there at the moment," said Koji Fukaya, chief FX strategist at Credit Suisse. The single currency fell 0.4 percent to $1.4137 EUR= in Asia, edging closer to an overnight trough of $1.4073, its lowest in three weeks. A break below that level is likely to open the way for a test of $1.40 and then the May 23 low of $1.3968. The euro also fell 0.2 percent to 1.2020 Swiss franc EURCHF=R, towards a record low around 1.1946 hit on Thursday. The euro rebounded on Thursday, helped in part by comments from the European Union's top economic official, Olli Rehn, that he expected the EU and the International Monetary Fund to release a crucial 12 billion euro loan tranche in early July to keep Athens afloat. But investors remained sceptical about the long-term outlook for the euro zone's debt problems. "I talked to a lot of investors today and some of them are saying that this is just a temporary solution. They are starting to dump the euro," said a trader at a Japanese bank. EUROPE'S PAYMASTER Markets were already skittish over Europe's dithering on a second aid package for Greece, due to differences over how to make private investors share the burden. Europe's paymaster Germany is insisting that banks, pension funds and insurance firms that hold Greek debt swap their bonds for new ones with longer maturities. But fearful that this solution could create a "credit event" that would prompt rating agencies to label Greece in default, the ECB, European Commission and France all favour a softer option in which holders of Greek bonds would be asked to buy new Greek debt as their holdings mature. Germany Chancellor Angela Merkel will meet with French President Nicolas Sarkozy later on Friday to try to resolve this dilemma. "If an agreement can be hammered out between these two, then that would pave the way for a broader agreement," BNP Paribas analysts wrote in a note. But they warned the uncertainty surrounding Greece could see the euro reach new lows versus the safe-haven Swiss franc. Against the yen, the dollar was at 80.65 JPY=, down from this week's high near 81.00, but still well within the prevailing range, roughly between 80.00-82.00. Elsewhere, the Australian dollar AUD=D4 fell 0.4 percent to $1.0520 after drooping to three-week lows below $1.0500 on Thursday. (Additional reporting by Chikafumi Hodo and Antoni Slodkowski; Editing by Joseph Radford)

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