US DOLLAR UP AS CONFIDENCE BOUNCES BACK

US DOLLAR UP AS CONFIDENCE BOUNCES BACK

The U.S. dollar rose Tuesday on signs the economy could begin revving up again.

If the economy is coming back on its own, the Federal Reserve may not need to cut interest rates again, dealers said.The bounce-back in consumer confidence to 99.9 in July should herald a period when the index stays near 100, said Delos Smith, an economist at the Conference Board.

Mr. Smith said the sharp June decline "was more of an aberration."

Confidence rose in July from June's relatively depressed level of 94.6.

Mr. Smith said he expects the economy to stay relatively strong, with low interest rates stimulating housing and automobile sales.

The economy should be relatively steady for the rest of the year, he said.

Earlier, reports circulated that the United States had accused Japan of being responsible for the strong yen during secret International Monetary Fund meetings. That knocked the dollar off its highs.

The rumor implies that U.S. officials may not be as eager to intervene to support the dollar as some in the market believe.

Washington supposedly argued at the IMF meeting that Japan's economic policy mix - from a distribution system that discourages imports to a credit policy that is still too tight - works to keep the yen high.

Since the start of the year, the dollar has fallen over 12 percent against the yen.