LONDON (ShareCast) - The dollar traded lower against the yen and the euro Monday as oil futures inched higher and as US equities headed lower.

Jitters over the US financial sector were exacerbated when federal regulators closed two more regional banks, owned by First National bank, late Friday.

Meanwhile Merrill Lynch added to the gloom when it said Lehman Brothers could post a loss in the third quarter and take more substantial writedowns on home loans.

Currency trading was subdued Monday as investors sat on their hands ahead of key economic reports due later this week including July's employment report.

The euro was little moved by a German report saying consumer confidence in the country fell to a more than a five year low. The US consumer confidence report is due Tuesday.

Sterling meanwhile fell against the euro on Monday as traders read yet another batch of house price data confirming the housing slump.

One report from the National Housing Federation provided some comfort for homeowners though with its predictions of a 25% rise in house prices over the next five years.

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