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The dollar was largely stable against other major currencies on Tuesday, but investors' appetite for risk was tamed after US President Donald Trump renewed his tariff threats against China. .
Over the past year, financial markets have been gripped by fears of escalating trade tensions between the world's two largest economies, raising concerns about global growth prospects.
Against a basket of six peers, the dollar index edged up 0.02% to 96.781 after closing the previous session with a gain of 0.2%.
The risk appetite remained moderate as investors waited for confirmation of a possible meeting between Trump and the Chinese president at the Group of 20 summit, which will be held towards the end of the month, have announced badysts.
Trump said on Monday that he was ready to impose a new round of tariffs on imports from China when he failed to reach a trade deal with President Xi Jinping at the summit of 28 and June 29 in Osaka.
Two months of negotiations to settle the US-China trade dispute last month in Washington ending in stalemate, the US President has repeatedly said that he expected to meet Xi at the G20 summit. China has not confirmed any meetings of this type.
"This might not happen if the Chinese side thinks it's useless to have a meeting if opinions are very far from the beginning," said Yukio Ishizuki, currency strategist at Daiwa Securities.
"Trump has lobbied stressing that there will surely be a meeting, but we do not know what the Chinese side will do."
In offshore trade, the Chinese yuan was up 0.2% to 6.9310 yuan to the dollar, reversing a previous loss. He was still hovering not far from a nearly seven-month low erased on Friday.
The currency was not helped by data released on Monday showing a 8.5% drop in imports in May, a result far worse than expected, which indicated weak domestic consumption.
The Australian dollar reached its lowest level in a week, at $ 0.6953, before recovering from its losses, which corresponds to the movement of the offshore yuan.
He was up 0.2% to $ 0.6965, recovering some of the declines from the previous session when he lost more than half a percent.
The Australian dollar is often seen as an indirect indicator of China's growth, as the Australian economy relies on exports to supply huge amounts of commodities to the Asian nation.
Elsewhere, the dollar remained stable at 108,415 yen, while the euro remained virtually unchanged at 1,1317 dollar.
The single currency plummeted on Monday after two sources close to the European Central Bank's talks said this weekend that a rate cut was firmly at stake if the bloc's economy stagnated again after a growth 0.4% in the first quarter.
The euro rose nearly 1.5% last week after the ECB announced that rates would remain "at their current levels" until mid-2020 instead of hinting at declines of rates, as some expected.
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