The article cites unnamed officials and says U.S. officials believe the foreign exchange market has been too focused on short-term turmoil and economic weakness in the U.S. and not enough on the medium-term resiliency of the U.S. economy.

"Policymakers on both sides of the Atlantic want to avoid a situation in which the dollar falls too far, before snapping back as investors realize the U.S. is not heading for a depression and Europe's economy is starting to soften too," the FT said.

In recent weeks, officials have often pointed to April's G7 communiqué as a major shift in policy that hasn't been fully appreciated by markets. It expressed "concern" about "sharp fluctuations in major currencies."

"Both U.S. and European officials intended the communiqué to signal that they did not want the dollar to weaken," the FT said.

By Adam Button, This email address is being protected from spam bots, you need Javascript enabled to view it , edited by Stephen Huebl, This email address is being protected from spam bots, you need Javascript enabled to view it