Global shares have edged higher, recovering some of the previous day's losses as improved investor risk appetite drove flows into equities and commodities, although concern over more COVID-19 infections in China tempered gains.
The Federal Reserve will release the minutes from its most recent meeting on Wednesday, and investors will scour that for any insight into policymakers' views on the outlook for inflation and economic growth.
The dollar pulled back from strong overnight gains while oil took a pause from Monday's retreat.
The MSCI All-World index of shares rose 0.2 per cent on Tuesday, putting it on course for a second straight month of increases - its longest stretch of gains since late 2021.
In Asia, Chinese blue chips closed flat on the day, having fallen by as much as 0.5 per cent, while Japan's Nikkei rose 0.6 per cent.
Chinese equities came under pressure after Beijing shut parks, shopping malls and museums on Tuesday, while more cities resumed mass testing for COVID-19, as cases spiked, which has fuelled concerns about the hit to the world's second-largest economy.
The Chinese capital said on Monday it was facing its most severe test of the pandemic, raising the prospect that the government may have to reimpose strict curbs on mobility and issue stay-at-home orders across other cities.
The dollar pared some of the gains that took it to a 10-day high on Monday, when investors ditched risk assets over China's COVID flare-ups and was last down 0.2 per cent. The dollar came under pressure in particular against the euro and the yen, which rose by 0.2 per cent and 0.3 per cent, respectively.
"On the Fed side, tomorrow's minutes will be important to watch, but the recent Fedspeak has undoubtedly added a layer of caution to the dovish pivot enthusiasm, which could mean investors may also be more reluctant to overinterpret dovish signals from the minutes," ING stragegist Francesco Pesole said.
Analysts at National Australia Bank questioned whether demand for the US currency would last.
"Evidence US inflation has peaked and can fall significantly in 2023, together with China and Europe developments, convince us a USD depreciation cycle is now in train," they said in a note on Tuesday.
US Treasury yields eased across most maturities ahead of Wednesday's minutes.
The benchmark 10-year Treasury yield fell 3 basis points to 3.94 per cent, while the two-year note yield also fell 3 bps to 4.50 per cent.
Oil prices rose on Tuesday, a day after Saudi Arabia denied a media report that it was discussing an increase in oil supply with OPEC and its allies.
Brent crude futures rose 0.6 per cent to $US88.10 a barrel, having fallen by as much as 6 per cent the previous day, before Saudi Arabia issued its denial and stemmed the decline.
Spot gold broke four days of losses, rising 0.2 per cent to trade at $US1,741.40 an ounce.