LONDON (MarketWatch) -- The U.S. dollar was slightly lower versus most major rivals Monday, slipping versus the euro and sliding versus the British pound after purchasing managers provided a stronger-than-expected assessment of European manufacturing activity. The dollar index (DXY 81.39, -0.15, -0.19%) , a measure of the greenback against a basket of major currencies, fell to 81.404, down from 81.535 in North American activity late Friday. The euro (EURUSD 1.3068, +0.0008, +0.0613%) traded at $1.3073 against the dollar, up slightly from $1.3055. The British pound (GBPUSD 1.5819, +0.0094, +0.5978%) , meanwhile, pressed to its highest level versus the dollar in 5 1/2 months and changed hands in recent action at $1.5824, a gain of 0.9% on the day. Read more about sterling's rally. The final July reading of a euro-zone purchasing managers index rose to a three-month high, data showed Monday, underpinning the single currency. The British manufacturing PMI slipped, but showed activity continued to expand at a solid pace near the post-recession peak scored in the spring. Read about the July PMI data. "Robust PMI prints across Europe continue to paint ex-US growth in a positive light and this may be encouraging further dollar selling," said Geoffrey Yu, currency strategist at UBS. Later Monday, investors will see the Institute for Supply Management's July reading on activity in the U.S. manufacturing sector. The index is forecast to fall slightly to 55.0% from 56.2% in June. The data will be released at 10 a.m. Eastern. Read about this week's U.S. economic data. Investors will also be focused on a speech by U.S. Federal Reserve Chairman Ben Bernanke. The dollar rebounded versus the Japanese yen (USDYEN 86.6500, +0.2800, +0.3242%) . A dollar bought 86.69 yen, up from ¥86.40 late Friday. Strong risk appetite kept pressure on both the dollar and the yen. Since the financial crisis, the currencies have tended to fall when equities and other assets perceived as risky are on the rise. The dollar and yen tend to gain ground when equities fall. Asian equities shrugged off weak Chinese PMI readings. European equities posted strong gains and U.S. stock index futures pointed to a sharply higher open on Wall Street. Read Indications. Currencies that tend to outperform when risk appetite is on the rise were solidly higher Monday, with the Australian dollar (AUDUSD 0.9110, +0.0053, +0.5852%) up 0.9% against its U.S. counterpart at 91.12 U.S. cents. The U.S. dollar fell 0.9% versus the New Zealand dollar (USDNZD 1.3795, -0.0078, -0.5622%) to buy NZ$1.3641. The U.S. dollar was down 0.7% against the Canadian dollar (USDCAD 1.0229, -0.0067, -0.6507%) to buy C$1.0220.

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