Dollar bounces, falls in foreign exchange trading

The US dollar hit back against the euro in foreign exchange trading today, but then once again fell in value as other currencies saw gains.

Belief among traders that the Federal Reserve will keep interest rates low for a long time kept investors away from the greenback.

Instead, they moved towards other currencies with the prospect of higher returns.

The pound also fell in trading on foreign exchange markets. It may weaken to 94p per euro before the end of the year, Commerzbank AG told Bloomberg.

Analysts from the bank wrote in a research note that a currency which the country's central bank likes to see weak is not an attractive option, the news provider reports.

The effect of the G20 Summit in Pittsburgh, which began this week, will have on the foreign exchange markets, remains to be seen. But progress toward economic recovery has helped to encourage investors away from the relative security of the greenback.