US dollar, compared to other international currencies, reported considerable fall in Europe on Thursday with the analysts remaining tightlipped about its rally in the New Year. The dollar index .DXY declined to 77.501 at 1215 GMT against its level of 78.218 during the previous session.

Stronger economic indications and prospectus of fast economic recovery strengthen the position of US dollar in recent weeks besides the hopes of more than earlier revision of key interest rates by the central bank.

Lee Hardman, currency economist at Bank of Tokyo-Mitsubishi UFJ , "We could some a partial retracement of December's sharp dollar rally early in 2010, but ultimately further improved U. S. economic data will fuel Fed tightening expectations and support the dollar."

Sterling declined to its 11 months low of $1.5834 on Wednesday. Pound, on the other hand, surged a 10-day high of $1.6150 in early trade taking notices of the Nationwide December house price survey which pointed out 5.9% year-on-year increase in house prices.

Meanwhile, euro/swiss franc has also taken a hit to decline at its lowest level since December 21. Geoffrey Yu, currency strategist at UBS in London added, "We're probably seeing some sort of rebalancing. The dollar has had a strong month and people are just taking profits."