The dollar hit a more than one-week high against a basket of other major currencies on Monday, helped by a pullback in the euro as investors took profits after the common currency’s recent rally.
The dollar index , which measures the greenback against six rival currencies, was up 0.37 percent at 92.287.
The euro slipped 0.47 percent to $1.1972. It had hit a nearly four-month high of $1.2089 on Thursday.
“The euro got a little bit over its skies when it traded over $1.20,” said Brad Bechtel, managing director FX at Jefferies in New York.
“The market is very stretched on the position,” Bechtel said. “It’s a little bit of profit-taking and some healthy correction going on the euro’s side, which is driving some of the dollar trades.”
The euro, which has rallied in recent weeks on expectations for a shift in European Central Bank monetary policy this year, suffered a little after a cooler-than-expected reading of the euro zone’s December consumer price index on Friday.
Lackluster inflation pressure in Europe has been accompanied by a strengthening economic recovery across the continent and solid economic growth in China and the United States, fueling risk appetite.