Investing.com - The dollar slumped to more than three months lows against the yen on Monday as concerns over the uneven economic recovery in the U.S. and heightened geopolitical tensions bolstered demand for the Japanese currency.
USD/JPY touched lows of 101.11, the weakest level since February 5 and was last down 0.33% to 101.18.
Investors remained cautious ahead of the minutes from the Federal Reserve’s latest monetary policy meeting on Wednesday, as they awaited insight on the central bank's view of the economy.
Data on Friday showed that U.S. housing starts recorded the largest increase in five months in April, indicating that the economy is shaking off the effect of a weather related slowdown over the winter.
However, the upbeat housing data was overshadowed by a report showing that consumer confidence in the U.S. deteriorated this month.
Safe haven demand was boosted as clashes between Ukrainian government forces and pro-Russian separatists in the east of the country continued on Monday, resulting in the death of one Ukrainian soldier.
The situation in Lydia remained tense after gunmen stormed the parliament on Sunday, in some of the worst violence the country has seen since the 2011 war against Muammar Qaddafi.
The euro edged higher against the dollar, but gains looked likely to remain limited amid growing expectations for fresh monetary easing by the European Central Bank at its next meeting in June.
EUR/USD was at 1.3720, up 0.20% for the day, recovering from the two-and-a-half month trough of 1.3647 reached last Thursday.
The euro has weakened broadly in the past two weeks, losing more than 1% against the dollar on the back of mounting expectations that the ECB will ease monetary policy at its upcoming June meeting to safeguard the recovery in the euro zone and stop inflation from falling too low.
Recent comments by ECB officials have indicated that the bank is open to easing and is prepared to act swiftly if necessary.
GBP/USD eased up 0.11% to 1.6830, while USD/CHF slipped 0.12% to 0.8914.
The Australian dollar slid, with AUD/USD down 0.18% to 0.9347. Elsewhere, NZD/USD eased up 0.09% to 0.8643 while USD/CAD was little changed at 1.0860.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was at a one-week low of 79.98.