Prior the start of the Federal Reserve policy meeting, the greenback eked out a small gain on Tuesday but has struggled to move much above previous five-week lows.

The dollar index that gauges the US dollar versus its major pairs inched up by 0.1% at 103.025 post slipping below 103 since a month ago.

The U.S. dollar has been affected by the continuous turmoil in the banking industry as traders have started to price in the likelihood that this stress would prevent the Federal Reserve from raising rates much higher, if at all, later this week.

EUR/USD soared by 1.0716 prior the release of the German ZEW poll of economic mood for March, which is anticipated to indicate a decline to 17.1 from 28.1 due in part to the banking upheaval.

GBP/USD slumped by 0.2% to 1.2251in advance of the Bank of England's upcoming meeting on Thursday, where it is anticipated to hike interest rates for the eleventh meeting in a row.

USD/JPY advanced by 0.4% to 131.85 where yen gave back some of its recent gains that were predicated on its safe haven status.