The U.S. dollar was slightly weaker on Monday, giving back early gains versus its major European rivals amid renewed concerns about the U.S. economy.
Sluggish improvement in the labor market and signs the housing situation has taken a turn for worse could mean the Federal Reserve will pause from tapering its bond-buying plan.
Fed officials insist they plan to gradually reduce stimulus, but a few more months of disappointing data could prompt a change of heart, weakening the dollar.
The buck was stuck at $1.3737 versus the euro, near a 7-week low. Early gains also evaporated versus the sterling, with the buck down a penny to $1.6665 from its overnight highs.
The dollar managed modest gains against the yen, inching up to 102.50. The pair has seen little movement since the dollar steadied from a 2-month low earlier in February.
In economic news, a survey of German business sentiment is up to its highest level in two and a half years. The Ifo Institute said Monday its business climate index for February rose to 111.3 points in February from 110.6 the month before.
European Central Bank President Mario Draghi said after the G20 meeting in Sydney he is ready to act if the outlook for prices deteriorates, although he sees no fear of deflation in the euro area.
Traders will be keeping an eye on U.S. economic data later this week. U.S. GDP data, as well as durable goods orders and consumer confidence, are due out.