It rallied to 119.73 Japanese yen from a slump of 119.22 and expected to reach 120.00.
Meanwhile, the euro remained at $1.0915 from a peak of $1.10295. Traders said failure to go over the post-central bank policy meeting peak of $1.10625 caused said reversal.
According to analysts, the pair of EUR and USD was not able to keep up the test higher than 1.10 with somewhat better-than- estimated consumer price index data leading to the sharp rebound of the dollar.
They said price action has matched market expectations that long-term market participants are inclined to purchase the USD above $1.10.
Notwithstanding this scenario, the euro was ahead of a 12-year trough ($1.0457) set last March 16.
The dollar also performed better versus commodity currencies like the Australian dollar which slipped below 79 cents from a two-month high of $0.7939.
US Treasury yields declined because of firm demand for two-year note sale.
The Reserve Bank of Australia will also come out with the twice a year report about the status of the nation’s banking industry today.
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