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The euro purchased as much as $1.5237 in early European trading Monday, just below the $1.5238 intraday high it hit on Friday. It fell back slightly to $1.5192, just down from the $1.5194 it bought in New York late Friday.
The British pound fell slightly to $1.9834 from $1.9883 in New York, while the dollar slipped to purchase 102.91 Japanese yen from 103.96 yen on Friday.
Speculation was growing among traders that the U.S. Federal Reserve could cut rates by as much as 75 basis points at this month's meeting, said James Hughes, an analyst at CMC Markets.
Lower interest rates can jump-start a nation's economy, but can weigh on its currency as traders transfer funds to countries where they can earn higher returns.
Investors will also try to determine whether their recent pessimism has been well-founded or overwrought in a report from the Institute for Supply Management on U.S. manufacturing in February.
Traders were looking ahead to a "flurry of start-of-the-month data" this week for direction, Hughes said.
"Essentially what traders will be left looking for are signals to underline that the ECB cannot afford to cut interest rates any further whilst the Fed will be presumably forced into further softening of policy in an attempt to stave off recession," he said.
[Associated Press]
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