NEW YORK: The dollar traded lower on Monday morning after weak results from a regional manufacturing survey added to doubts sowed by grim data last week that the US recovery is on shaky grounds.

The New York Fed's Empire State business conditions index fell to 3.7 in August versus 17.2 in July, and far lower than the 15 points forecast by a Reuters survey of economists. The reading indicates a slowdown in the manufacturing sector though the results were partially offset by strong housing data released earlier on Monday.

Against a basket of currencies the dollar traded 0.16% lower at 92.869, roughly in the middle of the range it has held since dropping to a two-year low in late July.

The moves in the dollar index were muted as uncertainty kept a lid on sentiment ahead of a week that includes the release of minutes of the US Federal Reserve's last policy meeting and the US Democratic Party's nominating convention.

The Australian dollar inched up to a one-week high of $0.723. The oil-sensitive Canadian dollar also edged 0.49% higher to C$1.320 per greenback.

Markets are also looking to the Fed minutes, due to be released on Wednesday, for any clues about an anticipated shift in the policy outlook.