Dollar 'remains subdued'

The dollar remained subdued on foreign exchange markets yesterday as investors continued to move away from the greenback in favour of riskier assets.

Continued evidence that a global economic recovery is beginning to develop helped to buoy confidence among investors.

A range of currencies hovered near one-year highs against the US dollar. The Australian dollar reached a one-year peak, while the euro continued to hold close to such a level.

The yen also remains relatively low.

Optimism in the markets is behind the latest falls in dollar and yen values, head of currency research at Commerzbank AG in Frankfurt Ulrich Leuchtmann told the Bloomberg news agency.

The dollar index, where the greenback is measured against a basket of currencies, also dropped to its lowest level since September 2008, the news agency reports.

While signs of recovery are continuing to emerge, governor of the Bank of England Mervyn King earlier this week told parliament's Treasury committee that the sustainability of the UK recovery remains uncertain.