The greenback returned to trade steady in the Asian session after recording the most significant decline in two months at the opening of trading earlier in the week.
Against a basket of major currencies, the dollar index rose slightly to 93.03 after retreating from a 9 -and -a -half -month high it reached last week.
Economic activity in the United States slowed again in August, which saw the manufacturing sector decline slightly to 61.2 from 63.4 previously recorded, while business activity also fell to 55.2 from 59.9 in July.
Investors are now more cautious ahead of Federal Reserve (Fed) Chairman Jerome Powell's speech at the Jackson Hole symposium conference on Friday that will see him speak on the outlook for the US economy.
Following speculation that the Fed would delay plans to reduce bond purchases due to the contagion of the worsening delta variant, the U.S. stock market traded positive again.
This also pushed the commodity currency to rise, which saw the Aussie dollar and loonie rise more than 1% against the US dollar. New South Wales, Australia is reportedly set to announce to ease restrictions on citizens who have been fully vaccinated this week.
Meanwhile, the depreciation of the US dollar also driven the rise of the euro from its lows, as well as supported by the reading of the European Zone manufacturing and services PMI data which still showed expansion albeit slightly slower.
The pound also rose, bringing it back to trade above 1.3700 against the US dollar. UK manufacturing and services PMI data readings were less encouraging with relatively slow growth.
