The US dollar rose to its highest level in more than two years against a basket of currencies on Tuesday, ahead of data expected to show that the US manufacturing sector has returned to growth, which may reduce concerns about the impact of the trade war with China.
The euro has lurched near its lowest level in more than two years against the dollar ahead of data expected to show that European inflation remains weak, suggesting that euro zone policy will remain easing for some time.
The Australian dollar fell after the Reserve Bank of Australia cut interest rates and expressed concern about job growth, while the New Zealand dollar hit its lowest level in four years as corporate confidence continues to weaken the impact on the currency.
The dollar index, which tracks the performance of the greenback against a basket of six major currencies, rose 0.10 percent to 99.479 after briefly touching the highest level since May 12, 2017.
The dollar was up 0.17 percent at 108.26 yen, approaching the strongest level in nearly two weeks.
The yen remained weak after a Bank of Japan report showed that corporate confidence fell in the third quarter to its lowest level in six years.
The euro was down 0.09 percent at $ 1.0889, close to its lowest since May 12, 2017.
The Australian dollar rose briefly, after the central bank announced a rate cut to a record low of 0.75 percent as expected but gave up later gains and lost 0.21 percent to $ 0.6742.
The New Zealand dollar hit a fresh four-year low of $ 0.6238, hurt by weak corporate confidence, boosting expectations for monetary easing.