NEW YORK/LONDON: The dollar took a pause on Tuesday in what has been a relentless climb higher while sterling as well as the euro and Japanese yen recovered some ground from multi-year lows after unusually volatile trading in recent sessions.

The dollar index, which measures the greenback against a group of major currencies, was last down 0.06% while Sterling after earlier climbing more than 1% to $1.0837, was last up 0.69%. The euro was up 0.18% at $0.9624, and the dollar slid 0.06% against the yen to 144.63.

The decline in the dollar was broadly in line with a renewal of appetites for riskier assets, which also boosted stocks on Wall Street and in Europe.

“Today there seems to be a tentative break in the exceptional volatility. That’s been enough to cool the dollar’s surge. Markets are going to remain volatile for the foreseeable future and that bodes well for continued dollar outperformance,” said Joe Manimbo, senior market analyst at Convera, in Washington DC.

Tuesday’s moves were minor compared to the dollar’s significant recent gains. The euro was still not far above its more than 20-year trough hit a day earlier, and the yen was just off its 24-year low hit last week before Japanese authorities intervened to strengthen the currency.

Sterling was not too far above its record low of $1.0327 hit Monday in a plunge that began Friday when markets were spooked by Britain’s gambit of relying on unfunded tax cuts to spur growth. Bank of England Chief Economist Huw Pill said on Tuesday that the BoE is likely to deliver a “significant policy response” to last week’s tax cut announcement but should wait until its next meeting in November.

England’s central bank had said on Monday that it would not hesitate to change interest rates and was monitoring markets “very closely.”

“We’ll have to see what the Bank of England’s response is ... They’ve said they’ll do whatever it takes to tackle inflation and stabilize the pound. For now markets are taking them at their word,” said Manimbo.

The dollar index was last at 113.78, on the day, but still near its 20 year top of 114.58 hit the day before.

The Aussie and kiwi, which hit 2-1/2 year lows on Monday, were also on the rebound, with the Aussie up 0.15% to $0.6469 and the kiwi up 0.61% to $0.5669.

Bitcoin, which also often moves in line with risk sentiment, hit a 10-day top and was last up over 5% at around $20,200