The US dollar traded narrowly mixed against its major counterparts on Wednesday as investors were cautious amid bipartisan talks on a budget deal.
Traders were worried that if the Congress cannot reach a deal by the end of the year, a series of automatic tax increases and government spending cuts will drag the economy back into recession.
Tensions intensified in the previous session as Senate Majority Leader Harry Reid said that there has been "little progress" in dealing with the "fiscal cliff."
However, concerns eased on Wednesday after House Speaker John Boehner, an Ohio Republican, said he is optimistic that lawmakers can "avert this crisis sooner rather than later."
Meanwhile, President Barack Obama said separately at the White House that he hopes the deal can be reached before Christmas. In late New York trading, the euro fell to 1.2932 dollars from 1.2934 of the previous session while the British pound dipped to 1.6015 dollars from 1.6018.
The dollar slipped to 0.9307 Swiss francs from 0.9309, and to 0. 9926 Canadian dollars from 0.9943.
The dollar bought 81.90 Japanese yen, lower than 82.17 in the previous session.