Dollar declines on comments, data

The US dollar declined Tuesday on comments from US Federal Reserve chairman Ben Bernanke told the Senate Banking committee that risks for both growth and inflation are increasing, while the Labor Department reported that producer prices are up 9.2 percent in the year ending in June and the Commerce Department said that retail sales rose by just 0.1 percent last month.

In early afternoon trade in New York, the dollar traded at $1.5918 to the euro after going to a record low of $1.6083 earlier in the session, while it took ¥104.8300 to buy a dollar after the Bank of Japan kept interest rates at 0.5 percent for the time being.

Meanwhile, the pound strengthened against both the euro and the dollar on new data showing that consumer price inflation in the UK was at 3.8 percent in June, its highest in 11 years.

At nearly 1 p.m. in New York, the pound traded at 79.46p to the euro and it took $2.0033 to buy a pound.

The Canadian dollar was also stronger in relation to its US counterpart after the Bank of Canada left interest rates at 3 percent, trading at C$1.0002 to the greenback on concerns that persistent credit market problems in the United States will spread to Canada.

The Swiss franc traded at SFr1.0092 to the US dollar on less enthusiasm for risky carry trades, which are sometimes financed with the low-yielding franc.

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