The dollar extended recent gains above two month lows against the euro and rose versus the yen today after the Group of Seven rich nations refrained from pressing China for a stronger yuan, offering the dollar relief.
The G7 repeated language used at a meeting last February, reaffirming exchange rates should reflect economic fundamentals and calling for currency flexibility.
This lifted some weight from the dollar, which was driven down last week by speculation G7 leaders would step up pressure on China to revalue its yuan as one measure to correct global economic imbalances.
Any move by China to free the yuan - now pegged to the dollar at a level that many analysts see as too low - would be expected to put downward pressure on the US currency.
At 10:45 a.m. the dollar traded at $1.2370, about 0.30 per cent up on the day against the euro, after having gained one cent from last week's two-month lows.
The dollar's rally brought it away from key chart support levels above $1.24, whose break many analysts said would precipitate a sharper decline.
China reaffirmed its stance on currency policy during the G7 summit, to which it had been invited as a guest, saying that it had no time frame to change the yuan peg.
"We have already said time and again we are moving toward a more market-based...exchange rate. How long it takes, I don't know," China deputy central bank governor Li Ruogu said. "I've been asked numerous times, 'What is the time frame?' I tell them, 'No time frame.'" Markets took this as a sign that the dollar was in no danger of being hurt by a flood of rising yen and, subsequently, other Asian currencies.