The euro bobbed around $1.18 but the pound was at two-week low of $1.3125 and the yuan back-pedalled too after US President Donald Trump warned about "decoupling" the US and Chinese economies.
The greenback was broadly flat at 92.15 against a basket of currencies in early European trading and just a shade above April 2018 low of 92.124 seen on Tuesday.
The dollar index, which tracks the greenback's value against a basket of currencies, had climbed 1% above the two-year low at 92.12 hit on Tuesday, and was consolidating gains at 92.90 in early London trading.
Upbeat readings on US business activity and home sales help push global equities and the dollar higher on Friday, counteracting earlier stock declines in Europe. The dollar’s gain put it on track to break an eight-week losing streak.
Global equities wavered and the dollar fell to two-year lows on Tuesday as the broad US stock market briefly scaled new peaks on better-than-expected corporate earnings but soon retreated on an economic outlook burdened by the coronavirus pandemic.
The euro inched higher on Friday with the dollar weighed down by concerns over the strength of a US economic recovery following weaker-than-expected jobs data, while China's yuan surged to a seven-month high as traders bet on Chinese growth.
Market response to the US-China conflict has been limited, but analysts say the confrontations have longer-term implications. Euro/dollar was last neutral at $1.1736, having fallen to $1.1722 earlier, its weakest since Aug. 4.
The euro fell on Monday as traders that have pushed the single currency to multi-year highs took a breather and prepared for the European Central Bank meeting on Thursday to see if policymakers will introduce yet more stimulus.
World stocks remained on course for their best month ever on Friday as recent vaccine progress, Joe Biden’s US presidential election win, hopes for further stimulus, a commodity surge and descending dollar all lifted the spirits.