U.S. and European officials signaled satisfaction that the dollar is stabilizing after Group of Seven policy makers expressed concern a month ago about its decline.

The dollar has advanced 3.4 percent from its record low of $1.6019 per euro on April 22, and is up 2.1 percent since the G-7 central bankers and finance ministers met in Washington April 11.

European Central Bank President Jean-Claude Trichet said May 8 he ``would be happy'' if traders take account of Treasury Secretary Henry Paulson's admonitions that the U.S. wants a ``strong'' dollar. A Treasury official said on condition of anonymity yesterday that the G-7's statement was aimed at getting investors to look past short-term U.S. financial-market turmoil.

``They've got to be quite happy as things are moving in their favor now,'' said David Gilmore, a partner at Foreign Exchange Analytics in Essex, Connecticut. ``There's a sense the market is finally getting the message of the G-7.''

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While the dollar's drop helps spur U.S. exports, it has also fueled a record commodity-price surge that is hammering consumers. The G-7 last month warned against ``sharp fluctuations in major currencies'' that could have ``implications for economic and financial stability.''

The Federal Reserve's major-currency dollar index has appreciated 2.5 percent from its record low of 69.26 in March. The currency was propelled by signs the Federal Reserve is ready to hold off on further interest-rate cuts after seven reductions since September and by speculation the worst of the credit crisis may be past.

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