LONDON, 3 March 2005 — The dollar lost ground against the euro late in the day here yesterday in reaction to testimony from US Federal Reserve Chairman Alan Greenspan that made no mention of US interest rates.

The single European currency was trading at $1.3095 at mid-day but later edged up to $1.3126. The euro late Tuesday in New York was at 1.3186. The dollar was meanwhile at 104.73 yen against 104.36 in New York on Tuesday.

A number of market participants had been predicting more hawkish rhetoric from the Fed chairman to the US House Budget Committee, possibly even an indication that future monetary tightening may become more aggressive.

Instead, Greenspan spoke about the US budget deficit and urged Congress to act decisively to rein in rampant government spending.

The euro was changing hands at $1.3126 against 1.3186 late on Tuesday in New York, 137.49 yen (137.60), 0.6865 pounds (0.6862) and 1.5424 Swiss francs (1.5363). The dollar stood at 104.73 yen (104.36) and 1.1750 Swiss francs (1.1649).

On the London Bullion Market, the price of an ounce of gold stood at $431.75 against $433.45 late on Tuesday.

Meanwhile, European stock exchanges turned in a mixed performance yesterday, with London slipping 0.15 percent to end the day at 4,992.8. In Paris the CAC 40 gained 0.19 percent to 4,062.72 while in Frankfurt the DAX added 0.22 percent to close at 4,393.43.

In New York, US stocks rose yesterday as investors viewed Greenspan’s comments on the economy as diminishing chances for more aggressive interest-rate hikes, which boosted financial stocks such as American Express Co. and Citigroup Inc.

The Dow touched a 3 1/2-year intraday high and the Standard & Poor’s 500 index hit a two-month intraday high. The Dow Jones Industrial Average was up 14.86 points, or 0.14 percent, at 10,844.86. The Standard & Poor’s 500 Index was up 3.16 points, or 0.26 percent, at 1,213.57. The technology-laced NASDAQ Composite Index was up 6.40 points, or 0.31 percent, at 2,077.65.

Asian stock markets put in another varied performance yesterday. The Tokyo Stock Exchange’s benchmark Nikkei-225 index was up 33.18 points to 11,813.71. In Seoul, the KOSPI index closed down 3.88 points at 1,007.48. In Hong Kong, the Hang Seng Index closed down 210.37 points at 13,850.78, off a low of 13,817.46 and high of 14,066.76.

In Sydney, the broader All Ordinaries Index put on 7.9 points to 4,172.3 just short of its record close of 4,182.9, also set on Feb. 7. In Singapore, the Straits Times Index rose 19.25 points at 2,144.36 while the All-Singapore Equities Index climbed 4.33 points to 548.21.

The Kuala Lumpur Composite Index fell 6.59 points at 891.90. The Philippine Stock Exchange composite index closed down 20.53 points at 2,068.42 after trading between 2,066.72 and 2,093.07. The Bombay Stock Exchange’s 30-share Sensex benchmark index rose 35.81 points to close at 6,686.89.