The US Dollar ticked lower on the back of a weaker tone surrounding the US Treasury bond yields amid fading optimism over a possible resolution of the prolonged US-China trade dispute.

The US decision to impose visa restrictions on Chinese officials, together with the blacklisting of Chinese firms over the treatment of Muslim minorities, threatened to derail US-China trade talks.

The development sparked a fresh wave of global risk aversion trade and was one of the key factors driving flows towards traditional safe-haven assets, like the US government bonds and the Japanese Yen.

Meanwhile, the Fed Chair Jerome Powell's comments on Tuesday suggested that interest rate cut in October was not a done deal, though did little to influence firming market expectations of a third interest rate cut this year at the upcoming FOMC meeting on October 29-30.

The GBP/USD pair nursed overnight heavy losses to a one-month low, triggered by reports that Brexit talks between Britain and the European Union were close to breaking down and renewed fears of a no-deal Brexit.

The incoming headlines from Eurogroup meeting might influence sentiment surrounding the European currencies, while any fresh trade-related development should continue to play a key role in driving the broader market risk sentiment amid lack of any major economic news.

Later during the North-American session, the Fed Chair Jerome Powell's scheduled speech might provide some short-term trading impetus ahead of the important release of the minutes of the latest FOMC policy meeting held on September 17-18 at 18:00 GMT.

Gold is holding onto $1,500 amid the risk-off sentiment, while Crude Oil is hugging the midpoint of the $52 handle but is under pressure following the loss of the $54 handle yesterday as the supply side case gathers pace.