The Dollar Index rose after Treasury Secretary Timothy F. Geithner said the U.S. will work to preserve confidence in a strong currency and won’t pursue a strategy of devaluation. South Korea’s won led Asian currencies lower versus the dollar as central banks took steps to contain foreign-exchange volatility. The pound weakened before minutes from the Bank of England’s latest interest-rate meeting, which analysts said may show policy makers are moving closer to extending asset purchases to boost the economy. “Geithner used the ‘strong dollar’ mantra for the first time in a while,” said Geoff Kendrick, head of European foreign exchange strategy at Nomura International Plc in London. “The dollar is slightly better bid, and it should base around here. This is a political hot potato.” The Dollar Index, used by IntercontinentalExchange Inc. to track the dollar against the currencies of six major U.S. trading partners, advanced 0.6 percent to 77.365. The U.S. currency strengthened to 81.47 yen at 06:37 a.m. in New York from 81.27 yesterday. The pound fell 0.6 percent to $1.5789 and the won slid 1 percent to 1,130.53 per dollar. The dollar was little changed at $1.3925 per euro after dropping to $1.4159 on Oct. 15, the weakest since Jan. 26. The euro was at 113.43 yen from 113.25 yen. The Dollar Index rose after Treasury Secretary Geithner said the U.S. envisions the dollar will remain the global reserve currency. Stimulus Efforts Geithner will travel to South Korea this week to meet Group of 20 nations’ finance ministers and central bankers to discuss currencies, government stimulus efforts and other economic policies. Brazilian Finance Minister Guido Mantega yesterday said that nations trying to defend their exports must end the “currency war,” while the nation raised taxes on foreign investments in fixed-income securities for the second time in a month yesterday to curb gains in the real. The won dropped for a third day after Finance Minister Yoon Jeung Hyun said authorities will act whenever “herd behavior” causes sudden moves in the currency. Yoon said the government is not keeping the won “artificially” low to support exports and the G-20 nations’ differing views on foreign-exchange policy are narrowing. “The minister’s comments look like part of a movement by emerging-market economies to protect their currencies from a weaker U.S. dollar,” said Sung Jae Man, a foreign-exchange analyst at Tong Yang Securities Inc. in Seoul. “Volatility in the won will decrease if countries reach an agreement at the G- 20 meeting.” Government Spending The pound declined before the publication of central bank meeting minutes and details of reductions in government spending plans designed to tackle the nation’s budget deficit. Policy maker Adam Posen has advocated further stimulus measures, saying monetary policy “should continue to be aggressive.” Fellow Monetary Policy Committee member Andrew Sentance has voted to raise rates. “There is a lot of investor uncertainty about the MPC minutes as they will provide us with a good idea about how close the BOE is to announcing additional asset purchases,” said Paul Robson, a senior foreign-exchange strategist at Royal Bank of Scotland Group Plc in London. “We may well get people trimming some positions, so sterling-dollar has a little downside before tomorrow’s minutes.” To contact the reporters on this story: Paul Dobson in London at pdobson2@bloomberg.net; Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net. To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net.

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