The U.S. dollar weakened, losing ground after China reignited market talk of a currency revaluation.
China said on Wednesday it would discuss its pegged yuan at next week's meeting of the Group of Seven rich nations in London. This appeared to signal a slightly different position from only a day earlier, when a senior Chinese official indicated any move on the yuan might be some way off.
With talk of a potential yuan revaluation back on the table, the dollar came back under selling pressure, wiping out the previous day's gains.
"The news out of China seems to have been the catalyst for that," said Jeremy Friesen, senior currency strategist at RBC Capital Markets in Toronto.
By late afternoon in New York, the euro was up 0.9 percent at $1.3082 from $1.2972 late on Tuesday. The dollar was also weaker against the Japanese currency, off more than 1 percent at 103.00 yen.
In U.S. Treasury markets, short-term debt prices dipped after an auction of two-year notes drew only modest demand.
After the auction, the yield on the current two-year note ticked up to 3.27 percent while its price inched down 2/32 to 99-16/32. Late Tuesday, the two-year note's yield was 3.22 percent. The benchmark 10-year note ticked down 1/32 to 100-12/32, to yield 4.20 percent. But the 30-year bond rose 12/32 to 110-21/32, for a yield of 4.67 percent, down from 4.69 percent on Tuesday.