The dollar rose against the majority of its major counterparts as the Federal Reserve’s pledge for record low interest rates failed to convince investors global growth will be sustained, boosting demand for haven currencies. The U.S. currency held a three-day decline against the yen before Fed Bank of New York President William C. Dudley is due to speak on the regional economy on Aug. 12. The euro fell against the greenback and yen amid speculation a slowing economy in the region will prompt the European Central Bank to ease monetary policy. South Korea’s won advanced as the nation’s unemployment rate held at the lowest level since November. “The step that the Fed did take in suggesting rates will likely remain low for some time was really one of the weakest of their options,” Todd Elmer, head of Group-of-10 currency strategy for Asia ex-Japan at Citigroup Inc. in Singapore, said in an interview with Bloomberg Television. “The risk is that investors cut that exposure in risky currencies and it contributes actually to a bit of dollar appreciation.” The dollar rose to $1.4346 per euro as of 6 a.m. in London from $1.4376 in New York yesterday, when it dropped 1.4 percent. The yen traded at 76.94 per dollar from 76.96. Japan’s currency rose 0.2 percent to 110.36 per euro. The Fed yesterday pledged to keep its benchmark interest rate at a record low at least through mid-2013 to revive a recovery that’s “considerably slower” than anticipated. The U.S. central bank is “prepared to employ” additional tools to bolster an economy hobbled by weak hiring and anemic household spending, it said in a statement. Currency Intervention The yen was within 1 percent of the postwar high of 76.25 per dollar reached on March 17, spurring concern a stronger local currency will derail Japan’s export-led recovery. Japan’s Finance Minister Yoshihiko Noda said in parliament today that one-sided moves in the yen can hurt growth. The yen strengthened to 76.97 on Aug. 4 before the nation sold the currency that day to weaken it. Japan is “very serious about preventing yen strength,” said Kurt Magnus, executive director of currency sales at Nomura Holdings Inc. in Sydney. The euro fell against 10 of its 16 major counterparts before a French report that economists say will show industrial production fell 0.7 percent in June from a month earlier when it increased 2 percent. The ECB may cut its key rate by 31 basis points for the next 12 months, according to a Credit Suisse Group AG index based on swaps, compared with an increase of 25 basis points that was signaled on Aug. 1. ECB Policy “We need to monitor further developments from the ECB to see whether they adopt a similar accommodative profile, in which case strength in the euro will only be short-lived,” said Tim Riddell, head of global markets research for Asia at ANZ Banking Group Ltd. in Singapore. Currently, the bank’s view on the euro is “relatively positive” in part because of the dollar’s weakness, he said. South Korea’s won advanced against all of its 16 major counterparts after Statistics Korea said today that the nation’s jobless rate was unchanged at 3.3 percent in July. That compared with the median estimate of 3.4 percent by economists in a Bloomberg survey. The won gained to 1,081.98 per dollar from 1,088.00 yesterday when it sank to as low as 1,096.05, the weakest level since May. To contact the reporters on this story: Candice Zachariahs in Sydney at czachariahs2@bloomberg.net; Masaki Kondo in Singapore at mkondo3@bloomberg.net To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net

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