The caution was underscored by a spate of US economic reports due to be released this week and ahead of a meeting of the Federal Reserve's policymakers Tuesday and Wednesday.
"We didn't see the dollar drop when the (Manafort) headline came out but I think it just provides more cautious undertones to what's going on right now," said Mizuho Corporate Bank currency strategist Sireen Harajli. "That does definitely play into it even if it's not the full story."
The dollar enjoyed its best week of the year last week and the risk-off environment was prompting traders to sell the greenback and take those gains, Harajli said.
Net short bets on the dollar fell to their smallest in nearly three months and roughly half of what they were a month ago, according to calculations by Reuters and Commodity Futures Trading Commission data released last week.
The day's risk aversion lifted the Japanese yen, often sought in times of geopolitical uncertainty, against the greenback. The dollar was last down 0.25 percent to 113.41 yen, near a one-week low.
The dollar was flat against the euro, which dipped after the release of German inflation data that showed prices had stalled. The euro was last at $1.1614, hanging above a three-month low touched Friday.
Currency markets had little reaction to US personal consumption data that showed consumer spending had grown at its fastest pace since 2009.
Friday's release of third-quarter economic growth data showed the economy expanded 3.0 percent, beating forecasts. It was the first time since 2014 that the US economy has experienced growth of 3 percent or more for two quarters in a row.
US jobs data and Purchasing Managers' Index (PMI) data are due this week.
Despite robust recent data, expectations of more US rate hikes and unwinding of excessive short bets against the greenback, economists at UBS were cautious about the dollar's outlook on concerns that a pickup in global growth would be a dollar negative story.
UBS expects a global growth spurt would mean investors look for attractive investment opportunities in all major and emerging markets, showing only a marginal interest in the slightly higher US yields.