The dollar rose towards a seven-month peak against a basket of major currencies on Tuesday.
The dollar fell against major world currencies on Monday as investors took profits on the greenback's surge last week.
The dollar jumped to a more than six-month high on after data showed the U.S. economy created more jobs than expected in October.
The dollar hit a three-month high against a basket of major currencies and a two-month peak versus the yen.
The dollar rose sharply as remarks from Fed Chair Janet Yellen intensified bets the central bank would raise interest rates next month.
Australia's dollar gained almost 1 percent on Tuesday, after the country's central bank declined to cut interest rates further.
The dollar fell against the euro on Monday after comments from two members of the European Central Bank's governing council.
The Bank of Japan's decision to leave monetary policy unchanged pushed the yen up on Friday.
The dollar index slipped the day after a hawkish statement from the U.S. Federal Reserve.
The euro fell against the dollar on Wednesday after the Federal Reserve kept interest rates unchanged.
Currency experts expecting the euro to reach parity with the U.S. dollar have been labeled "tiresome" by one strategist.
The dollar held firm against a basket of currencies on Tuesday as traders await the Federal Reserve's decision.
The dollar dipped on Monday although an improvement in risk appetite after China's monetary easing limited the losses.
The euro stumbled to a two-month low against the dollar on Friday.
The prospect of the euro falling to equal the dollar has returned with a vengeance after the ECB signaled it was willing to extend QE.
The euro tumbled on Thursday after European Central Bank President Mario Draghi said the bank discussed a further interest rate cut.
The dollar rose against emerging market and commodity-linked currencies on Wednesday.
The euro rose against the dollar on Tuesday, after falling for three straight sessions.
The euro slipped to a 10-day low against the dollar on Monday, as investors eyed a European Central Bank meeting later in the week.
The dollar rose broadly, as traders reckoned the Federal Reserve might raise interest rates later this year.