The euro weakened as investors fretted over economic risks to the euro zone economy, while concerns about Britain's plan to leave the European Union dragged the pound lower.

The dollar index, which tracks the greenback versus the euro, yen, British pound and three other currencies, was up 0.3 percent at 95.87.

"The dollar is winning the reverse beauty contest," said Karl Schamotta, chief market strategist at Cambridge Global Payments in Toronto.

"It's supported in a declining yield landscape by better-than-expected non-farm payroll and you are seeing a little bit of that risk appetite returning," he said.

A US Labor Department report on Friday showed non-farm payrolls jumped by 304,000 jobs last month, exceeding forecasts and the largest gain since February 2018. ISM manufacturing activity numbers for January were also better than expected, pointing to underlying strength in the world's biggest economy.

Dollar sentiment has undergone a U-turn in recent days with weak European data and expanding stimulus in China boosting demand for the greenback, despite indications from the US Federal Reserve that interest rate increases may be over for now.

With much of Asia closed by holidays this week, the dollar also took heart from recently concluded trade talks between China and the United States.

The latest positioning data showed speculators increased their net longs on the US dollar to their highest since December 2015, according to calculations by Reuters and Commodity Futures Trading Commission data.

Against the Japanese yen, which tends to benefit during geopolitical or financial stress as Japan is the world's biggest creditor nation, the dollar rose above 110 yen, for the first time since Dec. 31.

"It does suggest that we were seeing a sort of a false dawn in the Japanese economy, that growth expectations may have gotten ratcheted a little too high especially relative to what we are seeing in the United States," said Schamotta.

"You are looking at a push into the 110 yen to 120 yen range that could hold for a while," he said.

Sterling fell towards a one-week low as Prime Minister Theresa May met lawmakers to try and overcome a parliamentary impasse that has raised fears among investors about a disorderly 'no-deal' Brexit.

The Canadian dollar weakened against its US counterpart, reversing some of last week's rally, as oil prices fell and the greenback broadly climbed.