The greenback struggled to maintain its strengthening momentum after it extended its decline from a 20-year high at the opening of the European session.
Earlier, the currency king had surged following comments from Federal Reserve (Fed) Chairman Jerome Powell that boosted investor confidence to see continued tightening in the United States' monetary policy.
Expectations for an interest rate hike of 75 basis points have now risen above 70% according to the CME FedWatch tool.
Even so, the strengthening recorded by the US dollar subsided again as investors began to be cautious about taking profits towards the end of August trading.
Focus was also focused on the publication of JOLTS job opening data and US consumer confidence in the New York session, causing limited movement of the greenback.
Turning to the current movement of European currencies, the euro took advantage of the weakening of the US dollar to trade positively at around 1.0020 partiti price against the greenback.
The main focus of euro investors is the release of consumer inflation data from Europe's largest economy, Germany, which is expected to record a slightly slower increase in August.
A slower reading is likely to shake up the euro's move which is currently supported by the European Central Bank's hawkish statement on a bigger hike in interest rates at its September policy meeting.
The pound currency is back stable at around 1.1700 against the US dollar following the latest drop recorded to the lowest level since March 2020.
On the other hand, the Aussie and New Zealand dollars continued to recover from one-month lows by maintaining the gains made from the decline of the US dollar.
