The development between the world's two biggest economies offered hope for investors who have been rattled by tit-for-tat tariffs between Beijing and Washington this summer.
Still, doubts persist over whether the talks to be held on Aug. 21-22 would help the nations resolve their trade issues.
"I would say I'm very cautious whether this next round of talks would go anywhere," said Kristina Hooper, chief global strategist at Invesco in New York. "But the market is looking for anything to hold on for a kernel of hope."
The dollar's stalling near its multi-month high came while President Donald Trump praised its recent strength on Thursday, even though he had said a strong greenback puts U.S. exporters at a disadvantage.
"Money is pouring into our cherished DOLLAR like rarely before," Trump wrote on Twitter.
(Graphic: President Trump on the U.S. dollar:
Earlier Thursday, White House economic adviser Larry Kudlow told CNBC television a strong dollar was a sign of confidence.
The ICE index that tracks the greenback against six major currencies <.DXY> fell as much 0.4 percent before ending 0.06 percent lower on the day at 96.637. It reached 96.984 on Wednesday, which was the highest since June 2017.
The yuan in offshore trading
(Graphic: China t
rade balance with the United States and the yuan:
(Graphic: Yuan cross rates: http://tmsnrt.rs/1ZRXREu)
LIRA'S RECOVERY
Market optimism was also stoked by a further recovery in the Turkish lira, whose four-day plunge spurred a flight out of other emerging market currencies and touched off a selloff in the euro due to fears about European banks' exposure to Turkey.
Turkey's lira rose for a third straight day, gaining 2.4 percent to 5.8101
The lira reduced its earlier gains after U.S. Treasury Secretary Steven Mnuchin said the United States is prepared to impose more sanctions on Ankara if detained American pastor Andrew Brunson is not released.
The lira's bounce on Thursday helped boost the Brazilian real
The euro
German Finance Minister Olaf Scholz told Albayrak on Thursday that Germany has an interest in an economically stable Turkey.
On Wednesday, Qatar pledged $15 billion in investments in Turkey, stoking the lira's recovery from a record low.
Concerns remain about President Tayyip Erdogan's policies to combat Turkey's double-digit inflation and his row with Washington over the release of Brunson.
<p>(Graphic: Turkish lira tumbles, dollar rallies:
(Graphic: World FX rates in 2018 http://tmsnrt.rs/2egbfVh)
(Additional reporting by Tommy Wilkes in LONDON; Editing by Bernadette Baum and Chizu Nomiyama)
By Richard Leong
