The Euro advanced in the European market on Monday against a basket of global currencies, extending its gains for a second consecutive day against the U.S. dollar. This upward movement is supported by continued buying activity from two-week lows, as the American currency softens following an Axios report suggesting Iran has submitted a new peace proposal to the United States.

The European Central Bank (ECB) is scheduled to meet later this week, with market participants expecting interest rates to remain unchanged while looking for further clues regarding the path of European monetary policy for the remainder of the year.

Price Overview

- Euro Exchange Rate Today: The Euro rose against the dollar by 0.15% to ($1.1732), from an opening price of ($1.1717), reaching a high of ($1.1689).

- The Euro ended Friday's trading up 0.3% against the dollar, marking its first gain in four days as it recovered from a nearly two-week low of $1.1670.

- Over the past week, the Euro lost approximately 0.4% against the dollar, its first weekly decline in a month, triggered by the escalation of tensions between the U.S. and Iran.

The U.S. Dollar

The dollar index fell by 0.1% on Monday, continuing its decline for the second session and moving further away from its recent two-week highs. This reflects a broader slowdown in the U.S. currency's performance against major rivals.

The retreat in the dollar's strength comes as risk sentiment improves and demand for safe-haven assets cools. According to an Axios report citing informed sources, Iranthrough Pakistani mediatorshas presented the U.S. with a new proposal aimed at reopening the Strait of Hormuz and ending the conflict, while pushing nuclear negotiations to a later date.

European Central Bank

The ECB is set to convene this Wednesday and Thursday for its third monetary policy meeting of 2026. Markets fully expect the central bank to maintain current interest rates, which would mark the seventh consecutive meeting without a change.

However, Reuters reported that sources suggest the ECB might begin formal discussions regarding a potential interest rate hike during this weeks session.

European Interest Rates

- Money market pricing for a 25-basis-point interest rate hike by the ECB this week remains stable at less than 20%.

- ECB President Christine Lagarde stated that the bank stands ready to raise interest rates even if the anticipated spike in inflation proves to be short-term.