The dollar’s good cheer after Fed interest rate hikes yesterday, disappeared on Wednesday. The dollar had seen its highest gain against the yen in three weeks following the Fed’s announcement of taking interest rates to 4.75 percent. Fed Chairman Ben Bernanke has hinted at further interest rates to come. However, those gains were erased today on remarks by a senior Treasury official asking China to further appreciate its currency.

Rate increases make the dollar more lucrative to investors. The Fed has raised interest rates 15 times since June 2004. The current interest rate is 4.75 percent which is more than the 2.50 percent in the euro zone, Britain’s 4.50 and Japan’s zero. Euro zone rate are predicted to increase this summer.