The eased on Tuesday after the Bank of Japan sounded some cautious notes on growth but stopped well short of hinting at a new bout of money-printing.
In Europe, sterling traded near its lowest in two weeks against the dollar before inflation data, while the resisted a warning from European Central Bank chief Mario Draghi that it was too strong.
However, moves were minimal across the board, as investors waited for congressional testimony from Federal Reserve Chair Janet Yellen later in the day.
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The dollar inched up about 0.1 percent to 101.62 yen, rising as high as 101.65 yen and well off last week's seven-week low of 101.06 yen. The euro was up slightly at 138.32 yen, above last week's five-month low of 137.50 yen.
"The BOJ have essentially backed off the idea of quantitative easing for now but are sending some cautious signals on growth," said Simon Derrick, head of currency strategy at BNY Mellon.
"Everything is stable and we are heading slowly and jerkily back towards higher inflation."
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The BOJ kept monetary policy steady as expected and trimmed its economic growth forecast for the fiscal year to March 2015 to reflect soft exports and a slump in household spending after a sales tax increase.
BOJ chief Haruhiko Kuroda told reporters Japan was only halfway to meeting the 2 percent price target and the bank would maintain the quantitative easing program until the target was met.
By contrast, he added, the Fed was gradually moving towards policy tightening and he saw no reason for the yen to strengthen against the dollar.
The dollar index was steady at 80.174 , holding above a two-month low of 79.740 touched on July 1.
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Markets will examine Yellen's remarks before congress on Tuesday and Wednesday for clues on the timing of interest rate rises, after U.S. data in the second quarter signaled the economy was gaining momentum.
Private-sector jobs and non-farm payrolls growth in June were better than economists had expected and the unemployment rate fell to a near-six-year low of 6.1 percent.
"We're not expecting any surprises from her, but if U.S. yields fall on her remarks, the dollar could trend lower," said Ayako Sera, senior market economist at Sumitomo Mitsui Trust Bank.
Treasuries
The benchmark 10-year Treasury yield stood at 2.53 percent, below Monday's U.S. close of 2.549 percent.
Comments from other Fed officials have implied that policymakers are in no rush to tighten, and many investors expect more of the same from Yellen.
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Later on Tuesday, U.S. retail sales data for June could give more ammunition to economists predicting improved second-quarter growth. Economists polled by Reuters expect retail sales to show a rise of 0.6 percent, up from 0.3 percent in May.
The euro was steady at $1.3620 , showing little reaction to comments from ECB President Draghi, who told European lawmakers a strong currency could drag on a euro zone economic recovery.