The dollar was slightly higher against the euro early Tuesday after the Group of Seven nations signaled over the weekend about their concern regarding sharp fluctuations in exchange rates which they said could hurt the global economy.
The dollar traded at $1.5824 per euro at 9:29 a.m. Tokyo, up from a low of $1.5885 per euro on Monday. The U.S. currency was at 101.11 yen down from 101.05 yen. The euro traded at 160.12 yen.
The G-7's comments drew the attention of traders, with some analysts interpreting the comments as dissatisfaction foreign exchange shifts which have led to the devaluation of the dollar versus other major currencies. The G7 did not advocate a specific policy.
Adding to concerns for the dollar, Wachovia Corp., the fourth largest U.S. bank, reported a surprise loss, said it would bolster its balance sheet by cutting its shareholder dividend and announcing that it was seeking $7 billion in capital.
The development may be a signal that the end of the credit crisis linked to a sharp downturn in the U.S. housing market may not near an end. In recent weeks, bank executives have been mixed in their outlook, with most anticipating a return to growth by 2009.