The dollar slipped against the euro this morning, inching back towards a one-month low, as oil steadied after a sharp drop the previous day.
The dollar eased against the yen and the Swiss franc after the FBI said yesterday that groups monitoring Islamic militant websites say al Qaeda will soon post a video urging jihadists to use biological, chemical and nuclear weapons to attack the West.
Oil steadied at around $129 a barrel after having settled 2.5 per cent lower yesterday.
Surging oil prices have fanned fears about the ability of US consumers and businesses to weather the credit- and housing market-led economic downturn and prevent the economy from sliding into full-blown recession.
The euro rose 0.1 per cent from late US trading yesterday to $1.5702 edging back towards a one-month high of $1.5819 hit yesterday on trading platform EBS.
Against the Japanese currency, the dollar dipped 0.3 per cent to 103.96 yen Traders said Japanese exporters sold the dollar as they expect the US currency to stay in a 102-105 yen range for a while.
The dollar fell nearly 0.4 per cent against the Swiss franc to 1.0308 franc.
The euro had pulled back from its one-month high against the dollar after data from Europe yesterday showed that French business confidence slumped to a 2-1/2-year low in May, while the forward-looking German GfK index pointed to an unexpected deterioration in consumer sentiment in June.