The U.S. dollar steadied Wednesday after a three-day decline, but the safe haven is still near its lowest level in two weeks with risk sentiment enhanced by the U.S.-Japan trade deal.

At 04:10 ET (08:10 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded largely unchanged at 97.110, just above its weakest level since July 10.

The index has lost well over 6% since the start of the global trade uncertainty prompted by U.S. President Donald Trump's "Liberation Day" tariff announcement on April 2.

Dollar near recent lows
Trump's announcement of a trade deal with Japan has boosted optimism that a full-blown global trade war can be avoided, bolstering hopes for more agreements ahead of an impending tariff deadline.

In a post on Truth Social, Trump said that a tariff rate of 15% was set on imports from Japan, down from the 25% rate that was expected to take effect from August 1, and added that the Asian nation will invest $550 billion in the United States.

The U.S. currency has been one of the biggest losers since Trump announced sweeping tariffs on trading partners on April 2, only to delay and suspend most of the duties as his administration sought bilateral trade deals.

Attention will now turn to the release of more U.S. housing data later in the session, ahead of next week's Federal Reserve policy-setting meeting.

"The U.S. focus will be on the June existing home sales release, said analysts at ING, in a note. "Some are thinking that the housing sector will be the next shoe to drop in the U.S. slowdown.

Source: Investing.com