On Monday, the dollar hit a 2-week high against the yen, as the meeting between the President of the United States, Donald Trump, and Japanese Prime Minister, Shinzo Abe, was better than expected.
The USD/JPY pair peaked at 114.17, which was the highest level since January 30, at the time of writing being up to 113.73 or 0.49%.
Before the meeting, the US and Japan leaders feared that Trump will repeat his accusations against Japan as one of the countries that devalues its currency to gain an advantage in trade with the United States.
Abe and Trump agreed to continue the economic dialogue after Trump withdrawn the United States from participation in the Trans-Pacific Partnership (TPP).
Market sentiment also improved after Trump has agreed on Thursday to respect the one-China policy during a telephone conversation with his Chinese counterpart, Xi Jinping.
The US Dollar Index, which shows the value of the dollar to a trade-weighted basket of six major currencies, remained at 100.65, close to a weekly peak of 101.02 reached on Friday.
Demand for the dollar remains strong amid Trump’s statements that his administration will soon hold a tax reform.
Trump said on Thursday during a meeting with the heads of airlines that will present "something phenomenal about taxes in the next 2-3 weeks," but gave no details of the future reform.
The euro rose against the dollar: EUR/USD pair rose 0.14% to 1.0642. The investors expect to monitor the Greek events and the efforts to reach agreement on the allocation of the next part of the financial assistance by February 20.
The single currency also remained under pressure due to the fact that the results of the upcoming elections in France can prove as shocking as the UK referendum or the Trump victory.
On Monday, the European Commission has raised its forecast for the euro zone economy in the next two years, but warned that the uncertain US economic policy implications as well as the elections in Germany and France may have an impact on the European economy.
The pound rose against the dollar – GBP/USD rose 0.29% to 1.2524.