The dollar hugged tight ranges on Thursday as markets nervously waited to see if Hurricane Rita, which was heading for the coast of Texas, would damage the US economy and slow the pace of US interest rate rises.
Rita was upgraded to a Category 5 storm, a notch above Hurricane Katrina, which ravaged Louisiana in late August, making the latest hurricane one of the most intense storms on record.
There is speculation the storm could cause enough damage to put a brake on the Federal Reserve's year-long campaign of raising interest rates - a key factor behind the dollar's rally this year.
Commodity currencies benefited from the uncertainty over the Hurricane with the Canadian dollar hitting a 13-year high against the greenback as oil prices raced towards $68 as a result of Rita.
"The market is focused on Rita to a great extent, but it is becoming a bit of normality so the market is not pricing in a further risk," said Neil Parker, currency strategist at Royal Bank of Scotland Financial Markets.
"The Fed made it clear any impact from the hurricane would be temporary. If they don't stop at Katrina why should they stop at Rita? Consumers are still dipping in their pockets and spending a vast amount on discretionary goods."
By 1145 GMT, the dollar was virtually unchanged on the day at $1.2225 per euro and 1.2703 Swiss francs. In the wake of Hurricane Katrina in late August, the dollar hit three-month lows against the euro near $1.26.
The dollar was slightly lower at 111.18 against the yen, which weathered weaker Tokyo stocks, falling trade surplus and a steeper-than-expected drop in Japan's tertiary sector index of service industry activity.
The Canadian dollar extended earlier gains to C$1.1624 per US currency after data showed soaring gas prices pushed up Canada's annual inflation rate to 2.6 percent.
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