The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched down 0.04% to 96.165 by 10:46 PM ET (3:46 AM GMT). The euro edged down 0.14% overnight to $1.1307 and the pound retreated from a five-week high, helping to take the index to 96.165 from as low as 95.958 on Friday.

The dollar was also supported by climbing two-year Treasury yields, which hit a near two-year high on Tuesday.

“Things are mostly noise right now, though we are probably seeing a soft risk-on/risk-off dynamic going on with stocks down slightly, and the dollar has caught a bid on the inverse of that,” IG Markets analyst Kyle Rodda told Reuters.

However, Rodda remained bullish on the U.S. currency longer term, due to imminent interest rate hikes by the U.S. Federal Reserve and the reduced chance of future lockdowns in the U.S.

Expectations that the Fed will begin hiking interest rates before other major central banks, such as the European Central Bank, boosted the dollar index to its best year in 2021 since 2015.