The dollar lost ground on Wednesday, falling from an eight-month high, after Federal Reserve Chairman Ben Bernanke told a congressional committee the U.S. economic recovery is not yet sustainable, and interest rates are likely to remain low for an extended period.

The dollar index, which measures the U.S. unit against a trade-weighted basket of six major currencies, fell to 80.609, down from 80.874 in late North American trading Tuesday. It traded at the highest since June on Tuesday.

The euro jumped to buy $1.3582, up from $1.3534 on Tuesday, when it closed near the lowest since last May. It rose as high as $1.3626 on Wednesday.

The dollar turned lower against the Japanese yen after Bernanke’s remarks. The greenback bought 90 yen, down from 90.21 yen.

“We see no reason at all to change our view that the fed funds target rate (and the rate of interest paid on reserves) will be left unchanged throughout 2010,” said analysts at RDQ Economics.

Bernanke said there are some positive signs on the outlook but the job market remains “quite weak.” The last time Bernanke released public comments, in written form due to a snowstorm, was on Feb. 10, a little more than a week before the central bank announced a surprise 25-basis-point hike in its discount rate, to 0.75%.

The Fed’s promise in recent official statements to keep benchmark rates low for an “extended period” could mean about six months, he said, according to Dow Jones Newswires.