The dollar edged higher against a basket of currencies on Wednesday, after getting a boost the previous day as investors adjusted positions ahead of a global central bankers' conference later this week, Reuters reported.
The dollar index, which tracks the greenback against a basket of six major currencies, edged up 0.1 percent to 93.605, adding to its 0.5 percent gain from the previous day.
The dollar had risen on Tuesday as the euro was weighed down by a weaker-than-expected reading on German investor confidence. Position-squaring ahead of a gathering of central bankers in Jackson Hole, Wyoming, on Aug. 24-26, also supported the dollar, analysts said.
"Ahead of Jackson Hole...investors have started to reduce their short dollar positions," said Heng Koon How, head of markets strategy for United Overseas Bank in Singapore.
The market will probably go into a holding pattern for now, ahead of the Jackson Hole symposium, he added.
The dollar edged up 0.1 percent to 109.71 yen, pulling further away from a four-month low near 108.60 yen it set late last week.
Investors are awaiting speeches from Fed Chair Janet Yellen and European Central Bank President Mario Draghi on Friday in Jackson Hole, though neither is expected to announce new policy messages.
Draghi is also due to give a speech in Germany later on Wednesday.
The euro eased 0.1 percent to $1.1748, staying on the defensive after shedding 0.5 percent on Tuesday.
A survey out on Tuesday showed a steeper-than-expected drop in German investor morale in August, helping to weigh on the euro.