The dollar strengthened as traders pared back their expectations for aggressive Federal Reserve interest-rate cuts. The yen weakened against the greenback for the first time since July 29.
Bloomberg Dollar Spot Index rose 0.3% on Tuesday after two days of declines.
USD/JPY rose as much as 1.5% to 146.36, after falling as low as 141.70 on Monday.
The yen has more room to rally as the Fed moves to cut rates, according to Peter Berezin, chief global strategist at BCA Research, who is expecting no further hikes from the BOJ. Berezin targets USD/JPY at 115 for next year.
The Norwegian krone outperformed peers, rising about 1% against the dollar.
GBP/USD dropped 0.6% to 1.2696, lowest level since early July.
AUD/USD was trading 0.5% up at 0.6532, following the RBA's decision to leave rates unchanged at a 12-year high.
Source: Bloomberg
