The dollar sank on Wednesday, ahead of an expected hike in US interest rates, as grim jobs data, the US debt ceiling, and uncertainty following bank failures clouded the investment picture.

Data released on Tuesday revealed that job postings in the United States declined for the third consecutive month in March, and layoffs hit their highest level in over two years, implying that a sluggish labor market could hasten the Fed's fight against inflation.

The dollar index that gauges the greenback versus its major pairs, slipped by 0.3% to 101.56, plunging for the second consecutive day.

The Federal Reserve is largely expected to raise interest rates by 25 basis points when it closes a two-day meeting on Wednesday, and investors will be looking for clues from policymakers about what they might do next.

EUR/USD edged up 0.3% at $1.1033, before ECB meeting on of Thursday.

GBP/USD ticked up by 0.3% at $1.2509 and steadied versus euro at 88.20 pence.

USD/JPY advanced by 0.8% to 135.50, recouping some of its losses from the previous week, when the Bank of Japan maintained its ultra-easy monetary policy.