The dollar was trying to find a floor on Tuesday in holiday-thinned trade, pressured by signs that inflation in the world's largest economy is cooling which will likely give the Federal Reserve room to ease interest rates next year.

The yen meanwhile steadied near its recent five-month peak on the view that the Bank of Japan (BOJ) could soon mark an end to its ultra-easy policy. For most of 2022 and 2023, the policy has kept the Japanese currency under pressure as other major central banks embarked on aggressive rate-hike cycles.

The euro edged 0.03% higher to $1.1024, not too far from a five-month top of $1.1040 hit last week, while sterling was little changed at $1.2706.

The dollar index languished near a five-month low of 101.42 hit last week, and was last at 101.59.

In Asia, the yen rose 0.1% to 142.25 per dollar, drawing additional support from comments by BOJ Governor Kazuo Ueda.

Source : Reuters