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The dollar was adrift on Monday as markets looked ahead to a raft of US labour market data this week that could determine the size of the Federal Reserve's expected rate cut later this month.
Traders were also still assessing Friday's US inflation data and a court ruling that most of Donald Trump's tariffs are illegal, as well as the US president's ongoing tussle with the Fed over his attempt to fire Governor Lisa Cook.
The dollar rose 0.1 per cent against the yen to 147.20 in the early Asian session, after having clocked a monthly decline of 2.5 per cent against the Japanese currency on Friday.
The euro was up 0.1 per cent to $1.1693, while sterling edged 0.05 per cent higher to $1.3510. US markets are closed for a holiday on Monday.
Top of investors' radar this week will be Friday's US nonfarm payrolls report, which will be preceded by data on job openings and private payrolls.
"Markets will pay close attention to those data releases in order to gauge the state of the labour market... any downward surprises to the US labour market data this week will increase market expectations of a rate cut, and that will further give us clues as to whether that cut will be a normal 25-basis-point cut or an outsized 50-basis-point cut," said Carol Kong, a currency strategist at Commonwealth Bank of Australia.
Investors are currently pricing in an 87 per cent chance the Fed will ease rates by 25bps later this month, according to the CME FedWatch tool.
Against a basket of currencies, the dollar eased 0.04% to 97.79, having clocked a monthly decline of more than 2.0 per cent on Friday.
Rate expectations aside, the dollar has also been weighed down by worries over Fed independence, as Trump steps up his campaign to exert more influence over monetary policy.
A court hearing on Trump's attempt to fire Fed Governor Cook ended on Friday with no immediate ruling on the unprecedented legal fight, meaning she will remain in place for now.
At the same time, uncertainty over Trump's tariffs continues to linger.
US Trade Representative Jamieson Greer said on Sunday the Trump administration is continuing its talks with trading partners despite a US appeals court ruling that most of Trump's tariffs are illegal.
"I doubt it will be market-moving if tariffs are going to stay in place, and even if they are ruled to be illegal, I think Trump will find another legal avenue to implement the tariffs," said Kong.
In other currencies, the Australian dollar rose 0.18 per cent to $0.6548, while the New Zealand dollar similarly advanced 0.17 per cent to $0.5904.
The offshore yuan steadied near Friday's roughly 10-month high and last stood at 7.1216 per dollar.
The yuan has drawn support from firm central bank fixings in the onshore market and a buoyant domestic stock market, even as China's economy continues to struggle.
Data on Sunday showed the country's manufacturing activity shrank for a fifth straight month in August, suggesting producers are waiting for further clarity on a trade deal with the US while domestic demand remains sluggish.