The dollar is up against both the euro and yen this morning as currency traders await a testimony from Federal Reserve chairman Ben Bernanke. It is anticipated that Mr Bernanke will speak of the risk posed by rising inflation and the need for higher interest rates.

This morning the dollar was at 1.2493 to the euro, a dollar was worth 117.452 Japanese yen and the greenback was at 0.5471 to the pound.

The markets are also waiting on the publication of US consumer price data for June that will shed some light on inflation risks and the chances that the Federal Reserve will raise interest rates.

Mr Bernanke is scheduled to testify before the US Congress on the twice annual monetary policy report from 14:00 GMT, the consumer data is released at 12:00 GMT.

"We're expecting Bernanke to be fairly hawkish today, and the dollar is continuing to benefit from safe-haven buying," Nobuaki Kubo, a forex planning manager at Resona Bank, told Reuters.

"Basically, it's going to be hard to sell the dollar in the short term."