"It's going to be the Bank of England and European Central Bank rate verdicts that dominate the agenda for currency traders in the coming days," CMC Markets analyst James Hughes said of the decisions, both due Thursday.

The dollar rose against the euro. The 15-nation currency was worth $1.4696 in late New York trading, compared with $1.4773 Friday, when U.S. Labor Department data indicated that hiring was being sapped by the ongoing housing slump and credit crisis.

Rising inflation across the 15-nation zone that uses the euro, which rose 11 percent against the dollar in 2007, could put the European Central Bank in a quandary.

The bank has made fighting inflation — now estimated to be at 3.1 percent, well above its guideline of just under 2 percent — its central strategy, and that speaks against reducing interest rates.

However, higher rates — used to combat inflation — also can strengthen a currency, and the near-record strength of the euro has raised concern among businesses and politicians about the competitiveness of European exports.

The British pound fell to $1.9697 from $1.9723 on a sharp slowdown in the housing market, which may force the Bank of England to cut its benchmark interest rate from 5.5 percent this week — even though inflationary pressure is rising.

In other New York trading, the dollar gained to 109.03 Japanese yen Monday from 108.45 yen and rose to 1.1162 Swiss francs from 1.1056 Swiss francs.