The dollar dropped against the euro and yen on Monday following a
correction in the market last week.

Yesterday saw the euro reach a high of $1.3627 in New York trading, with
the dollar falling to 120.11 yen. However, it made gains against the
pound compared with Friday's trading, reaching $1.9931.

The movements came after official figures indicated an increase in US
unemployment of 4.5 per cent during April, reports BusinessWeek.

Later this week, the interest rate-setting committees for the UK, US and
Europe will meet, with the Federal Reserve largely expected to hold
rates despite the rise in unemployment. The European Central Bank is
also expected to freeze rates on Thursday.

Meanwhile, the Bank of England's monetary policy committee is widely
tipped to increase the UK rate on Thursday following recent figures
showing that inflation is now at 3.1 per cent, well above the target of
two per cent.

While a quarter-point rise to 5.25 per cent is expected, an increase to
5.5 per cent has not been ruled out by analysts and traders.