The euro slipped against the dollar, after positive data emerged from the US while the European Central Bank (ECB) offered no hint of a rate rise.

This morning the dollar was at 1.1940 against the euro and 1.7653 to the pound.

Federal Reserve chairman Alan Greenspan identified underlying strength in the US economy and hinted that the strategy of incremental interest rate rises to control inflation would be the Fed's main aim.

"The economic fundamentals remain firm, and the US economy appears to retain important forward momentum,'' he said.

"The longer term prospects of the US economy remain favourable."

Meanwhile, ECB chairman Jean-Claude Trichet surprised analysts with his hesitancy over plans for the interest rate in the eurozone.

Royal Bank of Scotland forex trading head Luke Waddington, told Reuters: "There's no coherent policy there."