Investing.com - The dollar rose to session highs against the yen on Monday after a report showed that U.S. pending home sales rose for the first time in nine months in March, indicating that the housing market is picking up.
USD/JPY touched highs of 102.62 and was last up 0.38% to 102.57.
The dollar found support after the National Association of Realtors reported that pending home sales jumped 3.4% last month, easily surpassing expectations for a 1% gain.
Pending home sales for February were revised to a 0.5% drop from a previously reported decline of 0.8%.
On a year-over-year basis, pending home sales were still down 7.9% in March.
The euro trimmed gains, with EUR/USD last trading at 1.3845, down from session highs of 1.3880.
Demand for the euro continued to be underpinned by hopes that the upcoming report on euro zone inflation on Wednesday would show that consumer prices ticked higher this month, easing pressure on the European Central Bank to implement additional monetary policy measures.
Earlier Monday, ECB Governing Council member Christian Noyer said that while the strong euro was weighing on consumer prices the euro area was not at risk of falling into deflation.
Meanwhile, GBP/USD was trading at 1.6808, not far from the four-and-a-half year peaks of 1.6853 struck earlier Monday.
Demand for the pound continued to be underpinned by expectations that the Bank of England could raise interest rates in the early part of next year.
Market participants were looking ahead to preliminary data on U.K. first quarter growth due for release on Tuesday, amid expectations that growth accelerated in the first three months of this year.
Sterling was also boosted by expectations for merger and acquisition inflows after U.S. drugs giant Pfizer confirmed Monday that it wanted to take over Britain's AstraZeneca in a deal worth almost £60 billion.
Elsewhere, USD/CHF was trading at 0.8807, after falling as low as 0.8770 earlier.
The Australian dollar edged lower, with AUD/USD slipping 0.10% to 0.9258, while NZD/USD was down 0.54% to 0.8533. The Canadian dollar was slightly higher, with USD/CAD dipping 0.10% to 1.1026.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was at 79.82, up from lows of 79.61.