Dollar Weakens as Investors Seek Higher-Yield Assets; Franc Resumes Rally

The dollar fell versus a basket of currencies of major U.S. trading partners as investors sought higher-yielding assets.

The franc briefly fell against the dollar and euro before a government briefing in Bern, then rallied as Finance Minister Eveline Widmer-Schlumpf said any decision on a target for the currency is up to the Swiss National Bank, not politicians. The franc surged earlier after the central bank refrained from pegging it to the euro or adopting a target. South Africa’s rand and Sweden’s krona climbed versus the dollar.

“There’s a broad sentiment that if you’re not getting a negative shock, it’s OK to go out and buy risk,” said Steven Englander, head of Group-of-10 currency strategy at Citigroup Inc. in New York.

The Dollar Index, which IntercontinentalExchange Inc. uses to trade the greenback against currencies including the euro and yen, fell 0.4 percent to 73.752 at 12:21 p.m. in New York, from 74.010 yesterday.

The greenback weakened 0.2 percent to $1.4433 per euro, from $1.4407. It fell 0.4 percent to 76.51 yen, from 76.80 yen.

The franc appreciated 0.7 percent to 79.04 centimes per dollar after briefly erasing gains before the government press briefing. It gained 0.5 percent to 1.1407 per euro after falling 0.8 percent earlier.

The Thomson Reuters/Jefferies CRB Index of raw materials climbed 1 percent. The Standard & Poor’s 500 Index rose as much as 1.3 percent before erasing gains.