The U.S. dollar fell against major currencies on Monday, with optimism over a potential agreement to reopen the Strait of Hormuz driving oil prices below $100 per barrel, despite both the U.S. and Iran downplaying the likelihood of an imminent deal.

Meanwhile, many global markets, including the U.S., Hong Kong, the U.K., and most of Europe, were closed on Monday for holidays, leading to reduced market liquidity.

The dollar weakened by 0.2% against the Japanese yen, trading at 158.91 yen.

Japanese Prime Minister Takaichi Sanae stated on Monday that Japan would allocate an additional $19 billion in reserves to subsidize fuel costs and alleviate living cost pressures. Concurrently, she pledged not to increase new borrowing to ease bond market concerns. This supplementary budget was first reported earlier this month.

The euro rose 0.33% against the dollar to $1.1641. The British pound gained 0.55% to $1.3499. The Australian dollar advanced 0.58% to $0.717, and the New Zealand dollar increased 0.5% to $0.5874.

The U.S. dollar index declined approximately 0.3% to 98.969.