The dollar index which measures the greenback against a basket of currencies including the yen and the euro, rose 0.03% to 99.09, with the euro down 0.07% at US$1.1654.
The yen also gave back some of the previous day’s gains, weakening 0.06% against the greenback to 158.7 per dollar. Sterling eased 0.04% to US$1.3387.
The greenback sank to a one-month low on Wednesday after the announcement of the truce in the Middle East conflict.
Still, the deal appeared to be on thin ice, as Israel continued its parallel war against the Iran-aligned militia Hezbollah in Lebanon, while Tehran accused both Israel and the US of violating the agreement and said that proceeding with peace talks would be “unreasonable.”
The Strait of Hormuz also remained shut to vessels sailing without a permit and shippers said they needed more clarity before resuming transit.
“Any signs that the ceasefire is breaking down, whether through renewed restrictions in the strait or spillover from regional conflicts like Lebanon, could push oil prices higher again, strengthen the US dollar and weigh on risk assets,” said Daniela Hathorn, senior market analyst at capital.com.
The dollar has been the major beneficiary of the Iran War among currencies, in part because the US is a net energy exporter and therefore less exposed to the economic hit that oil importers like Japan and many European countries might face.
The five-week war has shaken investor confidence, triggering the largest disruption to global oil and gas supplies on record.
The uneasy truce leaves Iran with greater leverage over shipping through the vital strait than before the conflict, analysts say, after president Donald Trump backed off from his threats to attack Iran’s civilian infrastructure.
The US is set to release February personal spending and the PCE deflator on Thursday. Despite improved sentiment following the ceasefire agreement, the dollar-yen pair may remain range-bound in Tokyo trading, although strong US data could trigger a rebound in the dollar, Akihiko Yokoo, senior analyst at Mitsubishi UFJ Bank, said in a note.
Bank of Japan governor Kazuo Ueda is expected to appear in the parliament from 0415 GMT on Thursday.
The Australian dollar weakened 0.13% versus the greenback to US$0.7034. New Zealand’s kiwi eased 0.02% versus the greenback to US$0.5821.
In cryptocurrencies, bitcoin fell 0.50% to US$71,018.20. Ethereum declined 0.96% to US$2,188.86.