The dollar went dancing up and down this Friday following Federal Reserve Chairman Ben Bernanke’s speech where he revealed the formulated steps the central bank to mull over to strengthen a weakening economy, nevertheless was vague on the particulars.

Bernanke told that the Fed would think about a large-scale purchase of securities, probably government debt with the expectation that it would drive interest rates low, thereby kick-starting more spending by Americans, however would make dollar-denominated assets will turn unattractive to investors.

The Fed chairman failed to reveal any further laying out a specific course of action, however iterate that the Fed would take action in case the economy deteriorated any further and prices fall.

The dollar had an instant jump subsequent to Bernanke’s speech, nevertheless lost ground one again in the later trading.

The euro slid as low as $1.2677 immediately after Bernanke began talking, but recovered to $1.2763 in midday trading, up from $1.2703 late Thursday.

The Fed chief further added that the economy was still vulnerable to shocks, and the recovery in output and the jobs market has sluggish more than the Federal Reserve had expected.

Last Friday, the government announced that the economy grew at a 1.6 percent, lower than the estimate of 2.4 percent growth. Economists had anticipated that the revision would be still larger, showing only 1.4 percent growths.

He said:

We will continue to monitor economic developments closely and to evaluate whether additional monetary easing would be beneficial. In particular, the Committee is prepared to provide additional monetary accommodation through unconventional measures if it proves necessary, especially if the outlook were to deteriorate significantly. The issue at this stage is not whether we have the tools to help support economic activity and guard against disinflation. We do. As I will discuss next, the issue is instead whether, at any given juncture, the benefits of each tool, in terms of additional stimulus, outweigh the associated costs or risks of using the tool.

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