The U.S. dollar weakened against other major currencies in the Asian session on Monday, following the remark's of Federal Reserve Chair Jerome Powell hinted that interest rates may not need to rise further. Also, a surprise pause in U.S. debt ceiling negotiations added pressure on the currency.

Speaking at a Fed conference in Washington on Friday, U.S. Fed Chair Jerome Powell reinforced expectations the central bank will leave interest rates unchanged next month. Citing recent turmoil in the banking sector, Powell suggested interest rates "may not need to rise as much as it would have otherwise to achieve our goals."

Traders remained cautious and optimistic that a deal will finally be reached on raising the U.S. debt ceiling to avert a first-ever U.S. default, despite talks being paused after Republican negotiators walked out the meeting.

U.S. President Joe Biden and House Republican Speaker Kevin McCarthy will meet later today for talks on averting a catastrophic debt default.

The U.S. could default on its debt as soon as June 1 if Congress fails to raise the borrowing threshold.

In the Asian trading today, the U.S. dollar fell to a 4-day low of 1.0829 against the euro and a 5-day low of 0.8969 against the Swiss franc, from Friday's closing quotes of 1.0805 and 0.8992, respectively. If the greenback extends its downtrend, it is likely to find support around 1.10 against the euro and 0.88 against the franc.

The greenback slipped to 137.49 against the yen and 1.2472 against the pound, from last week's closing quotes of 137.91 and 1.2439, respectively. The next possible downside target for the greenback is seen around 133.00 against the yen and 1.26 against the pound.

Against the Australia, the New Zealand and the Canadian dollars, the greenback edged down to 0.6667, 0.6292 and 1.3485 from last week's closing quotes of 0.6645, 0.6273 and 1.3494, respectively. The greenback may test support near 0.68 against the aussie, 0.64 against the kiwi and 1.33 against the loonie.

Looking ahead, Eurozone construction output for March is due to be released at 5:00 am ET.

At 8:30 am ET, Federal Reserve Bank of St. Louis President James Bullard will participate in a discussion on the U.S. economy and monetary policy before the American Gas Association 2023 Financial Forum, in Fort Lauderdale, United States.

In the New York session, Eurozone flash consumer confidence for May is due to be released at 10:00 am ET.

At 10:50 am ET, Federal Reserve Bank of Richmond President Thomas Barkin and Federal Reserve Bank of Atlanta President Raphael Bostic will participate in conversation before the Technology-Enabled Disruption Conference: Uncertainty and Prospects for Disruptive Investments conference, hosted by the Federal Reserve Bank of Richmond, in Richmond, United States.

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