The dollar index - which tracks the USA currency against six major rivals - fell to as low as 92.372, its weakest since early May 2016, before recovering a little to trade 0.3 per cent down at about 92.489.
Japanese Prime Minister Shinzo Abe called the test an "unprecedented" threat to his country and said he had spoken with US President Donald Trump about placing additional pressures on Pyongyang in retaliation.
The uncertainty of the American regulator and the decision by the European authorities to gradually phase out a soft monetary policy in the Eurozone led to the Euro strengthening against the dollar by 14.5% since the beginning of 2017.
According to economists at French investment bank BNP Paribas, a 10 percent rise in the euro corresponds with a fall of almost 0.5 percentage points in inflation over the next 12 months.
Draghi reiterated that that the European Central Bank will go extremely slowly when it starts removing monetary stimulus, with a decision expected in the autumn.
The central bank has allowed Europe's financial markets to enjoy a glorious summer-like period of extraordinarily accommodative monetary policy.
Harvey has knocked out a quarter of oil production from the Gulf of Mexico, prompting fears it could overturn years of USA excess oil capacity and low prices, with disruptions reverberating through global energy markets for weeks.
Davis stops Fonseca, IBF 130lb title remains vacant
When Davis was announced as the victor , the crowd booed leaving Davis with a quizzical expression on his usually smiling face. In the seventh round, Davis' feet got tangled with Fonseca's leg and that allowed Fonseca to land a meaningful left hand.
EUR/USD extended gains, rising 0.45% to 1.1979 on Monday. "The main safe haven trades, such as gold, US Treasuries and the yen have all strengthened, whilst the US dollar and equities have been casualties", says Richard Perry, a trader with Hantec Markets.
In early Tokyo trading on Monday, the dollar attracted buybacks and climbed to around ¥109.40.
At the time of writing the EUR USD exchange rate was trending around 1.2013 and the USD EUR exchange rate was trending around 0.8321.
The greenback was down against the Canadian dollar, with USD/CAD slipping 0.13% before rebounding to a modest 0.09% gain on the day.
Gasoline futures soared as much as 6.8 per cent as the storm, which came ashore on Friday, continued to batter the state.
"This will surely provoke a response from US President Trump who previously suggested the US would react with "fire and fury" at any escalation of threat. Both being very hard, may have to terminate?" "I do believe part of the weakness reflects transitory factors, but well recognise that inflation has been running under our 2 per cent objective, that there could be more going on".
Trump has threatened to pull out of NAFTA in the past.
USA gasoline futures hit a two-year high on Monday as Hurricane Harvey pummeled the heart of America's energy industry, while the euro rose to a 2-1/2-year peak after the European Central Bank President refrained from talking down the single currency.