The Dollar Index fell for a second week as Federal Reserve Chairman Ben S. Bernanke defended his unprecedented actions and made the case for further monetary stimulus to counter unemployment of more than 8 percent.
The dollar dropped to an eight-month low against the yen and fell versus the euro as data showed the U.S. lost more jobs in July than forecast, adding to concern the economy may need additional stimulus.
Former Republican House Speaker Newt Gingrich says Barack Obama’s policies are “artificially extending the recession.” Congressman John Boehner , the party’s leader in the House, says “stimulus policies aren’t working.” Republican Senator Jim Bunning calls Federal Reserve Chairman Ben S. Bernanke’s tenure “a failure.”
The euro dropped the most against the dollar in three months as German Chancellor Angela Merkel said the 16-nation currency is in an “exceptionally serious” situation after Ireland asked for a financial rescue.
The euro rose the most in eight months against the dollar amid speculation traders who have bet on its decline during Europe’s sovereign-debt crisis had to buy back the currency as it strengthened to a one-week high.