The dollar retreated slightly on Tuesday but held most of its gains on lingering optimism over a tariff deal between the United States and China, which tapped the brakes on a trade war between the world's two largest economies.

One glance at BofA’s currency and rates sentiment survey would have indicated a sharp reversal was imminent in the event of any positive macro developments.

LONDON: Stocks and the US dollar surged after the United States and China said they agreed on a 90-day pause on tariffs and reciprocal duties would drop sharply, giving investors some confidence that a full-scale trade war may have been averted.