The euro was last at US$1.1609 and sterling fetched US$1.3305, both down more than 0.1%.
The risk-sensitive Australian dollar weakened 0.4% to US$0.7121, while the New Zealand dollar was little changed at US$0.5827.
The dollar index, which measures the greenback against a basket of major currencies, was a touch firmer at 99.393.
Oil prices climbed on Monday, with Brent crude futures rising more than 1% to over US$110 a barrel, after a nuclear power plant in the United Arab Emirates came under attack and efforts to end the US-Israeli war with Iran appeared to have stalled.
“It appears conditions for risk and bonds are deteriorating, and conditions for the dollar rally to extend this week are ripe,” analysts at Barclays wrote in a note.
Signs that the Strait of Hormuz will remain clogged for longer are also exerting upward pressure, with the dollar gaining 0.5% to 1% for every 10% rise in oil prices, they added.
A global bond rout also dented risk sentiment, showing little sign of recovery, with Treasury yields staying elevated amid fears that Middle East energy disruptions could fuel inflation.
The yields on benchmark US 10-year notes and the two-year notes, which typically move in step with interest rate expectations for the Federal Reserve, were last at 4.607% and 4.085%, respectively, near their highest in a year.
“Near term, USD may stay better bid on dips if yields remain elevated and markets continue to price a more hawkish Fed reaction function,” Christopher Wong, FX strategist at OCBC, said in a note.
The focus this week will turn to the Federal Open Market Committee’s minutes and US flash Purchasing Managers’ Indexes, which could help clarify how much concern there is within the Fed over persisting inflation, and whether US activity momentum is holding up under tighter financial conditions, he added.
Against the yen, the dollar traded at 158.84, up 0.04% from late US levels, with renewed yen weakness putting investors on alert for possible intervention.
The offshore yuan traded at 6.8163 yuan per dollar ahead of Chinese activity data due later on Monday.