The dollar fell slightly from an almost three-week high on Tuesday after rising earlier in the session as currencies continued to waver on the back of uncertainty about tariffs.

U.S. President Donald Trump said not all of his threatened levies would be imposed on April 2 and some countries might get breaks, which helped the mood on Wall Street overnight by soothing some fears about a possible slowdown in U.S. growth.

A strong services component in S&P Global's flash U.S. PMI figures on Monday alongside a rotation back into Wall Street stocks helped push up U.S. bond yields, which supported the dollar.

Yet the U.S. dollar index gave up its gains in European trading and was last down 0.22% to 104.07, having earlier reached 104.46, the highest since March 5.

Meanwhile the euro reversed an earlier fall to a three-week low and was last up 0.16% at $1.0817.

Brent Donnelly, president of analytics firm Spectra Markets, said uncertainty remains high.

"The EUR/USD trade has petered out, as have the massive move in rate differentials and relative equity performance," he said.

"The view that tariffs are unambiguously bullish (for the) U.S. dollar has been challenged by the price action in 2025, and so even when we get the information on what tariffs look like next week, it will be hard to know what we are supposed to do."

The dollar has rebounded somewhat after falling to a five-month low in mid-March as Trump's stop-start tariff campaigns dented company and investor confidence and darkened the outlook for U.S. growth.

CONSUMER CONFIDENCE

Francesco Pesole, FX strategist at lender ING, said U.S. consumer confidence data due later on Tuesday would be key to the direction of the dollar.

"We're heading into big tariff announcements by the U.S., and the Fed last week signalled there's probably no rush to cut rates," he said. "But what really has been holding back the dollar is...that consumer sentiment story deteriorating very fast."

The dollar fell 0.4% to 150.09 Japanese yen, having pulled overnight above 150. It rose to a three-week high of 150.92 yen in the Asia morning.

Investors expect the Bank of Japan to go slow on monetary tightening that could bolster the yen. Minutes of the BOJ's January meeting released on Tuesday showed policymakers discussed the pace of raising interest rates.

Last week, the BOJ kept interest rates steady and warned of heightening global economic uncertainty. But many analysts still expect the BOJ's next move to come in the third quarter, most likely in July.

The Australian dollar climbed after the government launched fresh tax cuts on Tuesday and announced other cost-of-living relief in a major push to win back disgruntled voters. It was last up 0.51% at $0.6319.

Sterling rose 0.22% to $1.2951 as traders looked towards Wednesday's spring statement in which British finance minister Rachel Reeves is expected to cut government spending to meet fiscal rules.

Bitcoin hit a two-week high of $88,771 overnight but was last 0.8% lower around $87,209.

(Reporting by Harry Robertson in London and Tom Westbrook and Vidya Ranganathan in Singapore; editing by Gerry Doyle, Kim Coghill and Mark Heinrich)