Resuming gains after a break on Friday, the dollar dropped versus a basket of key rivals in European trade on Monday, drawing closer to two-week lows as US 10-year Treasury yields slowed down.
The Japanese government's intervention to boost the yen after it fell below 160 per dollar for the first time since 1990 also puts pressure on the greenback.
The Index
The dollar index closed up 0.5% on Friday, moving away from a two-week low at 105.41, and dropped 0.6% to 105.46, with a session high at 106.09.
Following strong US personal spending figures for March, the dollar also strengthened.
The information decreased the likelihood of a June or July interest rate cut by the Fed and increased pressure on Fed policymakers.
US Percentages
US 10-year Treasury rates dropped 1% on Monday, continuing their downward trend from five-month highs of 4.739%. This put pressure on the currency and diminished its reputation.
The changes occur ahead of this week's Federal Reserve policy meeting, which is anticipated to provide new information on the direction of US interest rates this year.
US Exchange Rates
The likelihood of a 0.25% Fed interest rate cut in June dropped to just 12%, while the likelihood of one in July dropped to 32% in the wake of US personal expenditure data released on Friday.
In today's European trade, the Japanese Yen gained 2.5% against the US dollar, breaking through its 34-year low of 160.21.
The spike occurred as a result of Japanese government intervention to defend the local currency, which marks 160 as the price barrier that the Japanese government won't allow to cross.
