The US dollar was higher against the euro and sterling midway through the morning session in Sydney on Friday, trimming overnight losses after Federal Reserve Chairman Ben Bernanke warned of sluggish economic growth until the end of the year and indicated the central bank is prepared to continue cutting interest rates to revitalise the world's largest economy.

Hawkish comments from European Central Bank member Axel Weber, coupled with Britain's recent strong wholesale inflation figures, added to pressure on the greenback.

The euro was buying 1.4637 dollars versus 1.4639 dollars in late New York trade after Weber

said the ECB would see a noticeable upward trend of long-term inflationary expectations as a

'clear signal' that it needs to act.

The sterling was worth 1.9685 dollars compared to 1.9689 dollars overnight while the dollar was down at 107.86 yen from 107.92 yen.

''Most of the chairman's (Bernanke's) comments reflected continuing concern about economic prospects, with banks and Wall Street expected to take more hits and 'more expensive and less available credit' a source of restraint on growth, and by extension, the US dollar,'' said John Kyriakopoulos, head of currency strategy at NAB Capital.

Elsewhere, the Australian dollar was doing 90.19 US cents compared with 90.14 cents overnight on expectations the Reserve Bank of Australia will tighten interest rates further.

Sydney at 9.55 am (2255 GMT)

US dollar

107.86 yen

1.097 sfr

Euro

1.4637 usd

157.86 yen

1.6059 sfr

0.7436 stg

Sterling

1.9685 usd

212.334 yen

2.15877 sfr

Australian dollar

0.9019 usd

0.4582 stg

97.27 yen

New Zealand dollar

0.7864 usd

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