Uncertain movements displayed the US dollar ahead of the publication of US inflation data on Wednesday.
The European session saw the dollar index slip from a high of 102.80 it hit on Monday, to around 102.15 against a basket of major currencies.
This in turn gives strength to the main currency to record strengthening and recover from the fall at the beginning of the week.
The pound currency is trading stronger again at around 1.2430 against the US dollar, further erasing previous losses.
Meanwhile, euro trading also rebounded to around the 1.0900 price level against the greenback at the opening of the European session.
Selling pressure also eased for yen trading as US 10-year bond yields returned to declines.
The yen's decline earlier in the week was fueled by statements from new Bank of Japan (BOJ) Governor Kazuo Ueda who pledged to stick with the current loose monetary policy.
On the other hand, the Aussie and New Zealand dollars registered a moderate increase despite the fall of the US dollar.
Both currencies failed to react to China's inflation data which showed a decline in March.
In addition, Canadian dollar trading also benefited from the weakness of the US dollar, in addition to being supported by the continued high price of crude oil.
