The greenback dipped om Tuesday, burdened by ongoing concerns about a potential recession, while optimism surrounding a German defense spending agreement drove the euro to rise.

The dollar was hit hard by growing speculation about a U.S. economic slowdown, particularly after a series of disappointing reports on business activity and consumer confidence.

Over the weekend, U.S. President Donald Trump hinted at a potential recession and economic turbulence while pushing his agenda, which includes government layoffs, spending cuts, and tax breaks. He also repeated threats of additional trade tariffs on both allies and rivals.

The dollar index that gauges the greenback versus its major pairs slumped by 0.6% and posed for hitting the lowest level in four months.

Traders will focus this week on key inflation data and a new job openings report for insights into the economy and interest rates.

EUR/USD ticked up by 0.7% to $1.0915. Traders were monitoring the ongoing talks on new military and infrastructure spending plans between the parties likely to form Germany’s next coalition government.