The bearded academic also denied that his institution's second round of long-term asset purchases, dubbed QE2, was responsible for the weakening of the dollar. "Much of the decline over the summer in the foreign exchange value of the dollar reflected an unwinding of the increase in the dollar's value in the spring associated with the European sovereign debt crisis," noted Bernanke. The depreciation of the greenback is due to "changes in investor risk aversion" and the "underlying strength and stability that the U.S. economy has exhibited over the years," he said.
