The dollar hovered close to its 2018 highs on Monday as slightly downbeat U.S. jobs and wages data barely effected perceptions of strength in the U.S. economy. However, analysts are aware that renewed concerns about trade frictions could cloud its outlook.

Dollar Index futures traded above 92.50, and are rising for three straight weeks, despite Friday's mixed U.S. data.

Non-farm payrolls data showed the U.S. economy added less jobs than expected and the average hourly earnings, which is closely watched for signs of inflationary pressures, rose a less-than-expected 0.1 percent in April, leaving the annual increase at 2.6 percent.

The jobless rate dropped to near a 17-1/2-year low of 3.9 percent, although this was driven in part by Americans leaving the labor force.

Expectations that the Federal Reserve will likely hike interest rates at least twice, and possibly three times, by year-end, are still well in place.

In contrast, recent economic data suggests that Europe's stellar growth last year is losing steam, leading speculators to trim bets on the single currency on expectations the European Central Bank will wind down its stimulus.

EUR/USD dropped to 1.19216 not far from Friday's four-month low of 1.1910. Cable traded as low as 1.3527, near its four-month low of 1.3487 touched on Tuesday. USD/JPY is off its three-month high of 110.05. trading around 109.30.