Dollar tumbles, gold up

The dollar slid against the world's favourite safe haven currencies, the Japanese yen and the Swiss franc, after the US Federal Reserve said it would keep interest rates at their current record low for at least two more years to support the weakening economy.

But the dollar whipsawed against many of the world's other currencies as investors who had hoped for stronger action from the Fed retreated to assets they consider safe: the yen, franc, gold and, to a lesser extent, the dollar.

Gold, which investors often treat as a safe-haven investment, climbed to near a record high.

The dollar fell below 77 yen for the first time since Thursday, when the Japanese central bank sold a mass of yen to weaken its currency. In late trading in New York, the dollar was worth 77.01 Japanese yen from 77.70 yen.

The dollar also hit its latest record low of 0.7062 Swiss franc. It has dropped more than 25 per cent against the Swiss currency this year. In late trading, it was worth 0.7141 franc, a huge drop from its value of 0.7559 franc late on Monday.

The euro jumped as high as $1.4312 immediately after the Fed issued its statement, before retreating to $1.4222.

It was worth $1.4190 late Monday.

The British pound dropped to $1.6220 from $1.6353, while the dollar edged up to 99.38 Canadian cents from 99.21 cents.

Gold prices rose even as some investors put their money back into the stock market.

Gold for December delivery gained US$29.80 to close at US$1,743 an ounce.

- AP