On Tuesday, the US dollar trades close to the lowest levels seen since several weeks amid a weakness in US Treasury yields and a cautious mood among investors prior to the FOMC meeting scheduled for later this week. At the time of writing, the US dollar index DXY is trading around 90.84.

The greenback also came under pressure as a safe haven currency after a risk-on sentiment in financial markets drove global equities to record highs during the previous session. Hopes for the global economy to post a sharp rebound and emerge out of the coronavirus crisis this year are on the rise, supported by intensified efforts to distribute the COVID-19 vaccines across the world.

The US dollar continues to hold below the 91 level after falling to a low not seen since early March against its key rivals. The weakness was driven by the benchmark 10-year Treasury yields holding below the 1.6% level after having strengthened to over 1.7% during the past month.

The reserve currency has also fallen out of favor among investors over expectations that Fed Chair Jerome Powell is unlikely to hint about calling off monetary easing efforts anytime soon despite the US economy showing signs of recovery. Analysts foresee the weakness in the dollar to continue for some time even as other economies around the world start improving, increasing the appeal of their respective currencies over the US currency.