The greenback was up 0.2 percent versus the yen at 120.44 yen, while the euro fell 0.4 percent to $1.1271.
Major U.S. stock indexes rose more than 1 percent.
Traders have scaled back bets that the Federal Open Market Committee, the Fed's policy-setting group, will end its near-zero rate policy on Thursday as this summer's global market turmoil over concerns about the Chinese economy may have overshadowed further improvement in the U.S. labor market.
Interest rate futures implied traders see about a one-in-four chance the FOMC will raise rates this week, although they still reckon the Fed will raise borrowing costs by year-end.
Read MoreWhy the Fed meeting won't be a big deal for dollar
Weak U.S. manufacturing data mitigated a decent rise in retail sales in August but did little to sway these views.
As investors wait to see whether the Fed may raise rates for the first time since 2009, the BOJ stood pat.
BOJ Governor Haruhiko Kuroda maintained his optimism that the Japanese economy will continue to recover moderately, although some traders had hoped for a surprise easing because of recent weak data.
"Further monetary easing is still on the table despite Kuroda's upbeat message on the economy," said Omer Esiner, chief market strategist at Commonwealth Foreign Exchange Inc. in Washington.
The Japanese currency clung to a 0.2 percent gain versus the euro at 135.73 yen.
Sterling fell 0.6 percent to $1.5330 after data showed subdued U.K. inflation in August, tempering the case for a rate increase by the Bank of England this year.
The lack of inflation is the central argument against a rise in U.K. rates, but jobs and wage growth have been more positive, supporting a view that the BoE will follow the Fed in lifting rates in early 2016.