On Tuesday, crude oil prices fell to fresh 12-year lows amid concerns that slowing global demand is fuelling a massive supply glut.
Investors also remained concerned over the extent of the economic slowdown in China, following a steep selloff in Chinese stocks and a renewed devaluation in the yuan since the start of the year.
Shares in China closed higher on Tuesday, after Beijing stepped up measures to support the yuan.
China’s central bank guided the yuan higher for a third day, but uncertainty over Beijing’s currency policy persisted.
The dollar edged up 0.11% against the Japanese yen, with USD/JPY to trade at 117.88, easing off Monday’s more than four-month trough of 116.68.
Elsewhere, the single currency slipped 0.15% against the dollar, with EUR/USD to trade at 1.0843.
The greenback was higher against the pound, with GBP/USD down 0.78% at fresh five-year lows of 1.4430, and was steady against the Swiss franc, with USD/CHF at 1.0013.
GBP/USD managed to register a fresh 52-week low, with the Sterling pound hitting the weakest level since June 2010, after the release of the UK industrial and manufacturing production data showing a sharp drop in November.
The poor data added concerns over the uneven UK economic recovery, with investors turn their attention for once again into the dollar, using it as a safe haven as the Asian markets continued to struggle to stabilise.
Investors concern that the Bank of England will signal that rates are likely to remain on hold for longer after its policy meeting, kept sterling under heavy selling pressure.
The Australian dollars edged higher, with AUD/USD up 0.10% at 0.7004, while NZD/USD slipped 0.18% to 0.6547.
Meanwhile, USD/CAD edged down 0.11% to trade at 1.4198, after hitting fresh 12-1/2 year highs of 1.4269 overnight.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.18% at 99.10.