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(Reuters) - The dollar fell against major currencies on Monday as early negative sentiment stemming from weak Japanese growth data dissipated and traders decided the currency's rally last week was too fast.
U.S. stocks recovered from an early decline on global economic worries sparked by the disappointing Japanese data. That saw the greenback give up some of last week's gains when risk aversion had pushed it up more than 3 percent against a basket of currencies.
Currency investors shrugged off U.S. manufacturing and housing data that pointed to weakness in the economy, though sentiment remained cautious overall with the safe-haven yen and the Swiss franc posting broad gains.
"We saw risk aversion abating. Despite some weaker data out of the U.S. including the NAHB (housing) index coming in weaker than expected, the market preferred to ignore that," said Matthew Strauss, senior currency strategist at RBC Capital Markets in Toronto.
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