"Powell's comments that the Fed is prepared to alter policy expectations quickly and flexibly are weighing on the U.S. dollar and giving risk sentiment a boost," said Eric Viloria, FX strategist at Credit Agricole in New York.
"Overall, Powells tone is cautious which is contributing to U.S. dollar softness," Viloria said.
The dollar index, a gauge of its value versus six major peers, stood at 96.12 early on Monday , down 0.07 percent.
The euro was 0.04 percent higher against the greenback.
"I think he (Powell) was not as forceful as some people, myself included, expected him to be. That is what took a bit of the wind out of the sails of the dollar, especially after a somewhat solid nonfarm payroll report," said Alfonso Esparza, senior currency analyst at OANDA in Toronto.
Market sentiment improved when China confirmed that trade talks with the United States would be held in Beijing on Jan. 7-8.
· U.S. government debt yields jumped on Friday after the government's monthly jobs report showed the U.S. economy creating jobs at a much faster pace than Wall Street expected. Wage growth also rose more than expected.
At 9:11 a.m. ET, the yield on the benchmark 10-year Treasury note which moves inversely to price, jumped 6 basis points higher to2.627 percent, while the yield on the 30-year Treasury bond rose 6 basis points to 2.955 percent. The 2-year yield climbed to 2.453percent.
The Labor Department said the U.S. economy added 312,000 positions in December and the unemployment rate rose to 3.9 percent. The jobless rate rose as 419,000 new workers entered the workforce and the labor force participation rate increase to 63.1 percent.
Wages jumped 3.2 percent from a year ago, gaining 11 cents between November and December, an increase of 0.4 percent. That gain was larger than the 0.3 percent increase Wall Street economists expected.
· Strong jobs data released earlier in the day helped offset recent concerns about the US economy, although Federal Reserve Chairman Jerome Powell noted Friday the central bank "will be patient" with monetary policy as it watches the economy evolve.
Powell stressed that monetary policy is not on a "preset path" after the Fed raised interest rates four times in 2018 and forecast two rate hikes in the new year.
· Federal Reserve Chairman Jerome Powell said Friday he would not resign from his post if President Donald Trump asked him to.
Powell also said he had not received any direct communication from the White House about unhappiness with the central bank's rate policy, and no meeting with Trump has been scheduled.
· U.S. President Donald Trump pledged on Sunday not to bend in his demand for a wall along the southern border with Mexico but said the barrier could be made of steel instead of concrete as a potential compromise with Democrats who refuse to fund it.
Trump threatened again, without providing specifics on where the funding would originate, to declare a national emergency as an alternative way to build the wall, depending on the outcome of talks in the coming days.
· U.S. President Donald Trump said on Sunday that trade talks with China were going very well and that weakness in the Chinese economy gave Beijing a reason to work toward a deal.
· Oil prices rose on Friday after proposed trade talks between the United States and China eased some fears about a global economic slowdown, but gains were capped after the United States reported a sharp build in refined product inventories.
Brent crude, the global benchmark, rose $1.11, or 2 percent, to $57.06 a barrel. ET. U.S. crude oil ended Friday's session up 87 cents, or 1.9 percent, at $47.96.
Reference: CNBC
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