Euro rose in European trade on Monday against a basket of major rivals, resuming gains against the dollar and heading towards three-week highs amid cautious trading ahead of fresh remarks by ECB officials.

The most important event this week is the release of US inflation data, which will provide important clues on the future of the Federal Reserves interest rates.

The Pair

The EUR/USD pair rose 0.1% today to $1.0780, with a session-low at $1.0766, after losing 0.15% on Friday away from three-week highs at $1.0812.

The pair rose 0.1% last week, the fourth weekly profit in a row as risk appetite improved marginally.

European Rates

The market is now prepared for a likely European Central Bank interest rate cut in June.

Investors are now focused on clues about potential upcoming ECB interest rate cuts this year, especially after recent data hurt the odds of large cuts in 2024.

US Rates

Following recent US payrolls data which were below expectations, pressures on the Fed subsided, and the odds of two Fed interest rate cuts in September and November improved.

Now markets await mainline US consumer prices data this week for April, in addition to producer prices and retail sales data.

Several Fed officials, including Fed Chair Jerome Powell will talk as well this week on inflation prospects and the future of monetary policy.