The dollar weakened against a basket of currencies on Tuesday in advance of a Federal Reserve meeting where policymakers are expected to decide on shrinking the central bank's $4.2 trillion in bond holdings.
The Fed's possible move to roll back stimulus further has not stemmed the greenback's weakness this year as other major central banks are considering steps either to slow their own bond purchases or raise interest rates.
Analysts widely anticipate Fed policymakers to announce a lowering of monthly bond purchases, starting in October, when their two-day meeting ends on Wednesday. They expect Fed officials would leave the door open for a rate increase at their Dec. 12-13 meeting.
"It's just a restless market before the Fed," said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.