NEW YORK – The dollar faced more headwinds Tuesday and the euro leapt to a new 2009 high on the greenback, as rising economic confidence whetted investors' appetite for the riskier assets.

The European unit fetched $1.4852 at 2100 GMT compared to $1.4771 late on Monday.

The euro had peaked at $1.4876 earlier in the trading day, its highest level since August 2008.

The dollar slipped to 89.67 yen from 89.85 yen.

Markets were choppy as gold hit another record high $1.068.63 an ounce, a further sign of sagging confidence in the US currency.

Michael Malpede at Easy Forex said the move by investors into oil, gold and other commodities quoted in dollars weighed on the greenback.

"The dollar was also pressured by diversification speculation as the Russian finance minister says the trend of diversification of reserves is likely to continue," he said.

"China and Russia would like to expand the use of the ruble and yuan in bilateral trade."

The euro earlier in the day fell as low as $1.4762 after publication of Germany's ZEW survey which showed that Europe's largest economy was recovering slowly.

The ZEW index, which measures the confidence of financial market players in the future health of the economy, fell to 56.0 from 57.7 in September.

Sacha Tinhanyi at Scotia Capital said the dollar has been on a steady downtrend but is still above its low against a basket of currencies hit in March 2008.

If the dollar is able to hold to a moderate pace of decline, he said, "we shouldn’t see any massive breakdown in dollar confidence, as the decline is far from being characterized as violent, though more rapid than most would prefer."

He said the dollar was unlikely to see much support until there were stronger hints that the US Federal Reserve would lift interest rates from near zero.

"Fed funds futures are not pricing in a rate hike until at least April of next year, which is still aggressive considering historical precedent, however not out of the realm of possibility by any means," he said.

"We expect the tightening of US monetary policy to play a key role in providing eventual dollar support."

Sue Voigtsberger at PNC Bank said Washington is facing growing pressure meanwhile to support the buck.

"The Obama administration has taken the stance that a weak dollar will help US exports and growth, but market participants are leery of this approach and feel that a much stronger stance needs to be taken to support the currency," she said.

In late New York trade, the dollar stood at 1.0214 Swiss francs from 1.0267 Monday.

The pound climbed to $1.5925 after 1.5799.