Investing.com - The dollar rebounded against a basket of the other major currencies on Wednesday as fears over geopolitical tension eased and investors looked ahead to U.S. data on jobs and second quarter growth.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.22% at 92.47 by 03:48 AM ET (07:48 GMT).
The index plumbed a low of 91.55 on Tuesday, the weakest since January 2015.
The dollar traded higher against the safe haven yen, with USD/JPY rising 0.36% to 110.10, having recovered from the previous session’s four-and-a-half month lows of 108.26.
Markets recovered after Monday’s slide in the wake of North Korea’s missile launch over Japan. Investors took some reassurance from President Trump’s relatively measured response.
Traders shrugged off North Korea's statement on Wednesday that the launch was a first step in military action to "contain" the U.S. territory of Guam.
The dollar was steady against the Swiss franc, with USD/CHF at 0.9553, well above Tuesday’s two-year trough of 0.9428.
The yen and the Swissy are often sought in times of geopolitical tension or market turbulence because both countries have large current account surpluses.
The euro was lower against the dollar, with EUR/USD down 0.27% to 1.1939, having pulled away from Tuesday’s highs of 1.2069, the strongest level since Jan. 2 2015.
Hopes that the European Central Bank will soon announce plans to taper its bond-buying stimulus program have driven the euro up around 14% against the dollar so far this year.
Investors were looking ahead to revised figures on U.S. second quarter gross domestic product and the latest private payroll numbers later Wednesday, which will be closely watched ahead of Friday’s non-farm payroll numbers.
Markets were also gauging the economic impact of Tropical Storm Harvey, which has resulted in catastrophic flooding in Texas and knocked out almost nearly a quarter of the U.S's crude oil refining capacity.