The dollar eased a touch against major currencies on Monday following a warning that al Qaeda may attack key buildings including the New York Stock Exchange and weaker-than-expected US economic growth figures.
The United States late on Sunday declared a "high" level threat alert for buildings also including the World Bank and International Monetary Fund in Washington after intelligence signalled a possible al Qaeda attack.
The news added to bearish sentiment towards the dollar, which was already under some pressure after data on Friday showed US second-quarter gross domestic product expanded at a 3.0 percent pace - below forecast growth of 3.6 percent.
"Terrorism is certainly one of the biggest risks for the dollar right now, but today's dollar-selling looks more a carry-over from Friday's weak GDP figures," said Tomokazu Ohno, forex strategist at Shinko Securities.
The dollar was trading around 111.15 yen, down some 0.2 percent from about 111.35 in late US trade on Friday, and around 1.2 percent below a two-month high near 112.50 yen struck last Thursday.
It was at $1.2060 per euro compared to around $1.2020 late on Friday.
The dollar fell more sharply against the Swiss franc, which investors prefer in times of geopolitical trouble. The greenback was around 1.2740 francs down more than 0.5 percent versus 1.2820 in late US deals.
Until Friday's GDP data, the US currency had been riding high, hitting a six-week peak against the euro on Thursday, as indicators endorsed optimism over the US economy and expectations for a gradual rise in official US interest rates.
"Market players are expecting fairly good US economic data this week. So I don't think there will be aggressive dollar-selling for now," said Kota Kimura, assistant forex manager at Shinkin Central Bank.
Later on Monday, a survey on US manufacturing is due at 1400 GMT.
Economists' forecast for the Institute for Supply Management's manufacturing index for July ranged from 59.5 to 64, compared to from 61.1 in June and well above the 50 mark that separates expansion and contraction. The median forecast was 62.
Some economists think a surprisingly strong July reading on Midwest factory activity on Friday portends a broader pickup. The National Association of Purchasing Management-Chicago's gauge of business activity rose to 64.7 in July from 56.4 in June.
Looking further ahead, the market's big focus this week will be the US non-farm payrolls report for July, due on Friday and the last major data before the Federal Open Market Committee's policy-setting meeting on August 10.
A Reuters survey forecasts non-farm payroll growth at 228,000 in July, up from 112,000 in June. Estimates range from 190,000 to 300,000.
Many traders think the data is unlikely to shake the market's view that the Fed will raise the federal funds rate by another quarter percentage point at its August meeting, to 1.50 percent, and keep pushing rates higher at a measured pace.
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