Euro rose in European trade on Monday against a basket of major rivals, extending gains for the second straight session against the dollar following consumer prices data released last week, which showed growing inflationary pressures on the European Central Bank.

Such data hurt the odds of early ECB rate cuts this year, with interest rates likely remaining at high levels for an extended duration.

EUR/USD

EUR/USD rose 0.2% to 1.0853, with a session-low at $1.0835, after rising 0.3% on Friday, the first profit in four days following European inflation data.

Euro rose 0.2% against the dollar last week, the second weekly profit in a row following bullish remarks by ECB officials, and strong European data last month.

European Inflation

Initial data showed eurozones consumer prices up 2.6% in February, above estimates of 2.5%, while slowing from 2.8% in the previous reading.

Core prices, excluding food and energy rose 3.1%, above estimates of 2.9%, and down from 3.3% in the previous reading.

The readings show the persistent inflation pressures on the ECB, which hurt the odds of an April rate cut.

ECB

The ECB is convening on Wednesday and Thursday to discuss monetary policies, widely expected to maintain interest rates unchanged at record 2001 highs.

The meeting is expected to provide fresh clues on the future of European monetary policies and interest rates.