LONDON—The dollar firmed against the euro and fell versus the yen on Tuesday following a rare comment on currencies by US Federal Reserve chief Ben Bernanke.
In late morning trading here, the European single currency fell to $1.4939 from $1.4972 dollars late in New York on Monday.
Against the Japanese currency, the dollar eased to 88.97 yen from 89.05 yen late on Monday.
Bernanke's remark in a speech on Monday caused the dollar to shoot up against the euro, but the greenback soon came under pressure again as traders bet that the low level of US interest rates would continue to deter buying.
Investors generally prefer currencies offering high yields.
"This bout of selling pressure on the dollar appears to be easing following Bernanke's remarks, which signaled US interest rates will stay low for the time being," said Yosuke Hosokawa, head of foreign exchange group of Chuo Mitsui Trust.
"But the dollar is likely to face another bout of selling," Hosokawa said.
Bernanke said the central bank was closely monitoring exchange rates with the dollar having lost its gains from safe haven flows during the height of the financial crisis.
"We are attentive to the implications of changes in the value of the dollar and will continue to formulate policy to guard against risks to our dual mandate to foster both maximum employment and price stability," the Federal Reserve chief told the Economic Club of New York.
"Our commitment to our dual objectives, together with the underlying strengths of the US economy, will help ensure that the dollar is strong and a source of global financial stability," he added.
But Calyon analyst Mitul Kotecha said that "the reality is that the Fed is probably quite comfortable with a weak dollar given the positive impact on the economy and lack of associated inflation pressures".
Elsewhere, International Monetary Fund chief Dominique Strauss-Kahn on Tuesday again urged Beijing to let the yuan rise "sooner rather than later," saying it would benefit both China and the global economy.
"The renminbi (yuan) is undervalued. It's not only in the interests of the global economy but also in the interests of China to have a revaluation," Strauss-Kahn told a news conference at the end of a two-day visit to Beijing.
But Strauss-Kahn acknowledged that it would "take time" for China to loosen its grip on the yuan, whose exchange rate with the dollar has remained stable since July 2008.
Beijing is under mounting pressure to let the yuan appreciate, with the United States and Europe complaining the currency is being kept artificially low.
In London on Tuesday, the euro was changing hands at 1.4939 dollars against 1.4972 dollars late on Monday, at 132.91 yen (133.35), 0.8863 pounds (0.8898) and 1.5104 Swiss francs (1.5086).
The dollar stood at 88.97 yen (89.05) and 1.0111 Swiss francs (1.0072).
The pound was at $1.6854 (1.6818).
On the London Bullion Market, the price of gold rose to $1,134.80 an ounce from $1,130 an ounce late on Monday.
