The dollar surrendered most of its early gains versus the euro, yen and other major currencies as Treasury yields slipped amid market positioning ahead of nIfp4S281d key U.S. economic releases on Thursday and Friday.
The Fed's Beige Book reinforced rising inflation, supply-demand frictions and labor market dislocations evident in recent data.
EUR/USD rebounded from a 1.2163 low to down 0.07% near Tuesday's 1.22135 close on EBS.
The early low was fostered by an unexpectedly large 5.5% drop in German April retail sales.
Overall, EUR/USD has been range bound, awaiting U.S. jobs data Thursday and Friday, and ahead of next week's ECB meeting.
ECB President Christine Lagarde's comments today that strong policy support will continue to provide a bridge over the pandemic and well into the economic recovery nF9N2KZ01Y appeared aimed at minimizing speculation about reduced asset purchases.
Last week's 1.2133 low at the 61.8% Fibo of the May 13-25 rise, along with the nearby 30-day moving average and daily kijun, are major support.
After an early slide, sterling rebounded off the rising 21-day moving average for a 0.13% gain.
Softer-than-forecast UK lending data added to the early pullback, but the pound got some help from UK PM Boris Johnson's optimism about the scheduled June 21 reopening, though he noted the ongoing need for caution.
The broader issue for sterling's uptrend is whether it can clear 2018's post-Brexit referendum recovery high at 1.4377.
USD/JPY also gave back much of its early gains amid the retreat in Treasury yields, and was up 0.05%, holding above the tenkan line and Tuesday's pivotal low at 109.38/33.
Those props are supported by the kijun, which beat back late May breakdown attempts, now at 109.27, and huge 109 expiries on Thursday, teamed with large 110 expiries.
There was more jawboning from China warning against speculation driving the yuan higher, but USD/CNH has so far been unable to get back above the key support at 6.4000 it broke below last week.
Commodity currencies were mostly higher as reserve currency government debt yields drifted lower and the dollar shed early gains.
Bitcoin and ether improved toward their May 26 swing highs.
Thursday brings May services PMIs and ISM, along with the ADP report and weekly jobless claims data ahead of Friday's monthly employment report.
Fed Chair Jerome Powell is also due to speak before the payrolls report.
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