The U.S. dollar appreciated against its major counterparts in the Asian session on Tuesday, as investors awaited U.S. inflation data due later this week for more clues on the Fed monetary policy outlook.

With price pressures growing, there are hopes that the Federal Reserve is heading closer to begin discussions about tapering of the asset purchase program.

Comments from U.S. Treasury Secretary Janet Yellen that higher U.S. interest rates would be positive for the economy added to worries.

The NFP-led optimism faded after Yellen's comments during the weekend.

A strong inflation reading could fuel fears of a Fed taper, ahead of the Fed's rate decision later this month.

The greenback rose to 1.2164 against the euro and 0.8989 against the franc, off an early low of 1.2194 and a 6-day low of 0.8966, respectively. The greenback is seen locating resistance around 1.20 against the euro and 0.92 against the franc.

The greenback rebounded from its prior lows of 109.20 against the yen and 1.4185 against the pound, gaining to 109.54 and 1.4131, respectively. The greenback may face resistance around 112.00 against the yen and 1.37 against the pound.

The U.S. currency edged higher to 1.2095 against the loonie, 0.7736 against the aussie and 0.7203 against the kiwi, after dropping to 1.2077, 0.7763 and 0.7233, respectively in previous deals.

Looking ahead, German ZEW economic sentiment for June, Eurozone GDP and employment data for the first quarter are set for release in the European session. If the greenback rises further, 1.25, 0.75 and 0.70 are seen as its next resistance levels against the loonie, the aussie and the kiwi, respectively.

U.S. and Canadian trade data for April will be released in the New York session.

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