The dollar fell against most majors on Thursday amid weakening hopes for an agreement between Republicans and Democrats over a new coronavirus fiscal aid to support the U.S. economy.
The dollar was at a disadvantage following a decline in Treasury yields. However, analysts say that this setback will only be temporary because U.S. lawmakers are likely to craft a deal on the new coronavirus pandemic.
The euro rose to 1.1813 on the dollar, while the pound climbed 0.25% to $1.3067. The dollar lost 0.2% to 0.9105 against the Swiss franc and slipped from a three-week peak to 106.65 on the yen.
In onshore trade, the yuan slightly rose to a five-month high before it steadied at $6.9380.
President Donald Trump claimed that congressional Democrats did not want to negotiate on a new coronavirus fiscal aid as Republicans and Democrats exchanged blame for failing to craft a deal.
Market sentiment stands mixed on the issue, but analysts say that negotiators will likely agree on a deal since the lack of additional stimulus will stall economic recovery.
The dollar index slid 0.2% in Asian trade but floated above the two-year low it hit last week.
Elsewhere, the Aussie gained 0.2% to $0.7176 amid positive economic and jobs data. The kiwi stood at 0.6581 on the dollar after the New Zealand central bank expanded quantitative easing and dismissed the prospect of negative interest rates.