The dollar continued to drift lower against major currencies as players exhibited caution ahead of Federal Reserve chairman Alan Greenspan's testimony on the US economy. Greenspan will appear before the joint economic committee of Congress tomorrow, and markets will keep their eyes peeled for any hint that the rate hiking cycle in the US may be coming to an end. The Fed has raised its key Fed fund rate from 1 pct to 3 pct during the last year but soft economic indicators of late suggest that the rates do not have much further to go. Markets are starting to price in just two more US rate hikes this year, and if the Fed were to take a pause in its tightening cycle, concerns over the financing of the US current account deficit could well resurface and overshadow the US short-term yield advantage. In the meantime, the euro has been able to find a 'correction' after sharp recent falls to gain lost ground on the dollar At levels above 1.23 usd, the euro reflects the perceived risk in the dynamics of European politics. But the euro may soon have troubles of its own, largely from the political arena after the rejection of the draft EU Constitution in France and the Netherlands. Investors are awaiting the outcome of various meetings between EU officials to determine what the next step will be following the rejections of the EU constitution in the recent referendums in France and Holland.