- Trump reiterates displeasure at Fed's rate hikes
- Trump also accuses China, Europe of manipulating their currencies
- Euro rises about 0.4 percent after Trump's Fed comments
The dollar slipped against the yen and a basket of major peers on Tuesday after U.S. President Donald Trump said he was "not thrilled" with Federal Reserve Chairman Jerome Powell for raising interest rates.
The dollar was also soft as investors pulled out of the safe-haven currency ahead of anticipated talks this week between China and the United States, which some market participants believe might lead to an easing in trade disputes.
"At the moment, markets fear that Trump may have some impact on the Fed's policy," said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.
"Especially the dollar/yen, which is sensitive to the rate moves of the United States, remains under pressure."
The yen JPY= rose 0.18 percent to 109.87 yen as of 0050 GMT. The dollar on Tuesday fell below the psychologically-significant 110 yen level for the first time since June 28.
The dollar index .DXY against a basket of six other currencies fell 0.44 percent to 95.475 as of 0041 GMT after touching as low as 95.440, its lowest level since Aug. 9.
The greenback slipped after Trump said in a Reuters interview on Monday he was "not thrilled" with Powell's raising of interest rates. Trump nominated Powell last year to replace former Fed Chair Janet Yellen.
The U.S. president spooked investors in July when he criticised the Fed over tightening monetary policy. On Monday he said the Fed should be more accommodating on interest rates.
Mizuho Securities' Yamamoto said Fed officials don't seem to be influenced by Trump's comments.
"As long as the U.S. economy is okay...then I think there is no reason to stop the rate hikes from the Fed's point of view," he said.
Trump also said the U.S. central bank should do more to help him to boost the economy while he also accused China and Europe of manipulating their respective currencies.
Escalating trade tensions between the United States and its trading partners and a plunge in the Turkish lira had pushed the dollar index to 96.984 on Aug. 15, its highest since June 2017.
The dollar's rally halted ahead of anticipated trade talks between Chinese and U.S. officials in Washington. Media reports have said the talks will take place in the next few days.
The euro, which had slipped to a 13-month low early last week amid concerns that the Turkish crisis could hurt European bank, gained on Tuesday. The single currency EUR= rose 0.37 percent to $1.1523 as of 0051 GMT.
The offshore Chinese yuan CNH=D3 was 0.16 percent stronger at 6.8262 per dollar. The Australian dollar AUD=D3 was 0.14 percent higher at $$0.7350.
