The US dollar fell slightly against most major currencies on Wednesday as rising US stocks boosted risk appetite in foreign exchange trading.

Investors were losing confidence in the British financial system despite new plans unveiled on Monday by the British government to help financial institutions.

During early trading on Wednesday, the pound fell to its lowest level against the dollar in more than seven years.

The pound rebounded later as Wall Street rose amid a better-than-expected profit report from information technology giant IBM. US stocks were also boosted by hopes that a new US administration led by President Obama would provide more help to financial institutions and other companies.

Analysts said recover of the pound would be brief, as the British currency was under heavy pressure from the flagging British economy. Investors are expecting further government intervention and deeper rate cuts from the Bank of England.

The euro bought 1.2954 dollars in late New York trading compared with 1.2891 dollars it bought late Tuesday. The pound rose to US$1.3922 from US$1.3917.

The dollar fell to 1.2613 Canadian dollars from 1.2653 Canadian dollars, and rose to 1.1574 Swiss francs from 1.1473 Swiss francs. It fell to 89.43 Japanese yen from 89.82 Japanese yen.

(Xinhua News Agency January 22, 2009)