The US currency pared its recent advance late Monday after US President Donald Trump and French leader Emmanuel Macron both agreed not to include tariffs in their digital tax dispute until at least the end of 2020.
As this developed, prices of crude on the global market climbed after a series of supply disruptions Iraq and Libya.
Stocks in Europe shifted lower and US bonds drifted Monday as Wall Street traders braced for a new round of corporate profits and a series of important central bank meetings in the coming days.
Activity was uneventful across key trading floors to give way to a US holiday. Contracts on New York's main equity benchmarks cut earlier losses to trade nearly unchanged.
At the Stoxx Europe 600 Index, the session was down as losses in retailers' cushioned gains for telecommunications companies.
Stocks were mostly up in Asia, but slid in both India and Hong Kong. Most European bonds moved up, while the British sterling came out moderately weaker ahead of the European Union's employment data report.
The Bloomberg dollar index retreated following the Macron Report, and Trump agreed that punitive tariffs should not be implemented.
France and US said they will continue their meetings, while the Economic Cooperation and Development Organization, of which the two countries are members, is working on a policy for imposing taxes on tech firms.
Brent crude hovered back over $65 per barrel, as Iraq temporarily halted production at an oil field, while output from Libya nearly stopped after a pipeline was shut down by the armed forces.
Doubts on the oil market appear to temper investor confidence following the signing of the initial China-US trade deal and optimistic economic figures from China helped elevate sentiment.
The latest forecast by the International Monetary Fund gives investors more reasons to mull over, with the Fund estimating that the global economy will improve this year, albeit in a moderately slower momentum than previously thought.
Investors are now setting their sights back to corporate revenues after an impressive output from the largest finance institutions on Wall Street. Key central bank meetings in Japan and Europe are also included in the upcoming talks.
According to Anne Anderson, Fixed Income Assets chief for UBS Asset Management, "we are welcoming the year on a more stable footing with global economies stabilizing."
Meanwhile, IBM, Netflix, UBS, Hyundai and Procter & Gamble are set to report their earnings results. Policy decisions are also due from central banks including Canada, Japan, Indonesia and the European Central Bank.
