Investing.com - The dollar eased against the other major currencies on Tuesday, pulling back from highs hit after China’s central bank moved to devalue the yuan, sending the Chinese currency to three year lows.
China devalued the yuan in an attempt to help exporters after a recent spate of disappointing economic data.
The central bank described it as a “one-off depreciation” of nearly 2%, based on a new way of managing the exchange rate that better reflected market forces.
Figures released over the weekend showed that Chinese exports dropped 8.3% in July, their biggest fall in four months, while producer prices fell to a six-year low.
The greenback strengthened following the surprise move as investors sold other Asian currencies.
USD/JPY was last at 124.76, after rising to highs of 125.07 earlier.
EUR/USD was last up 0.18% to 1.1038 from lows of 1.0961.
The single currency was boosted following reports that Greece and its international lenders have reached a deal on third bailout.
Greece, which narrowly avoided an exit from the euro zone last month, must repay €3.4 billion to the European Central Bank by August 20.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was firm at 97.19, off highs of 97.64.