The dollar added to gains against a basket of major currencies on Tuesday after Federal Reserve Chairman Jerome Powell told U.S. lawmakers the central bank would stick with gradual interest rate increases despite the added stimulus of tax cuts and government spending.
Powell pledged to "strike a balance" between the risk of an overheating economy and the need to keep growth on track. His congressional testimony was his first public appearance since being sworn in as chairman earlier this month.
Powell is scheduled to present his remarks to a U.S. House of Representatives committee at a hearing scheduled for 10 a.m. EST, followed by questions from lawmakers.
Brad Bechtel, managing director FX at Jefferies, in New York, said Powell's comments were generally positive for the dollar.
"He is hawkish in the context of being very upbeat on the economy but willing to go at a moderate pace to normalize policy," Bechtel said.
The dollar index, which measures the greenback against a basket of six other major currencies, was up 0.48 percent at 90.27.