The Bloomberg Dollar Index fell during late New York trading as President Trump projected a swift conclusion to the Iran conflict and contemplated taking control of the Strait of Hormuz. Following Trump's remarks, crude oil futures retreated while U.S. equities advanced. The Australian and New Zealand dollars led gains among G-10 currencies.

On Monday, the Bloomberg Dollar Index declined 0.1%, after having climbed as much as 0.7% earlier in the session.

Finance ministers from the Group of Seven nations pledged readiness to implement all necessary measures to support global energy supplies, which could involve releasing strategic petroleum reserves.

Alex Cohen, a foreign exchange strategist at Bank of America, noted that Trump's comments clearly triggered a market reaction. He stated that the U.S. dollar has benefited from the recent oil price shock, so any signs of easing tensions could lead to a pullback in the currency.

He added, "However, uncertainty remains, and markets will continue seeking evidence that crude supplies and shipping can begin to normalize."

The New Zealand dollar appreciated 0.6% against the U.S. dollar, reaching 0.5932, while the Australian dollar also rose 0.6% to 0.7075.

The euro gained 0.1% against the U.S. dollar, trading at 1.1625, after earlier dropping to 1.1507, its lowest level since November 24 of the previous year.

Analysts at Mitsubishi UFJ Financial Group recommended shorting the euro against the U.S. dollar, targeting a level of 1.13, citing factors including the energy market shock.

The U.S. dollar edged down slightly against the Japanese yen, settling at 157.70.

Meanwhile, the U.S. dollar advanced 0.1% against the Canadian dollar, reaching 1.3585.