The greenback dollar recorded a slight increase in early European trading, but remained trading around a two-week low against most major currencies.
The dollar index, which measures the strength of the greenback dollar against a basket of major currencies, traded at 90.41.
Disappointment over weak inflation readings and Federal Reserve (Fed) Chairman Jerome Powell's statement continued to put pressure on the giant currency trading amid a slow trading session following the Chinese New Year holiday.
Powell reiterated the central bank's commitment to continue to support the economy by maintaining a loose current monetary policy approach to achieve full employment targets.
Meanwhile, Lisa Cook, an economist with a dovish stance, is reportedly nominated by President Joe Biden, as a member of the Fed committee.
Market focus is now focused on the publication of US weekly unemployment interest claim data to be released tonight and is expected to show a steady decline.
Meanwhile in Europe, Germany continues to extend coronavirus restrictions even though daily cases have begun to show a decline. The euro continues to stay above the 1.21000 price level against the USD.
The pound sterling is seen to be slightly depreciated, but strong above the price level of 1.38000, probably due to investors wanting to take profit after pushing it to a two-year high.
On the other hand, commodity currencies traded steady, following the weakness of the US dollar, amid slow trading sessions.
