The US dollar opened the week with a flat performance, maintaining the trend of the last three sessions, while expectations of early interest rate cuts continue to decline. Strong US economic data affected sentiment, with retail sales and job market figures coming up stronger than expected. Federal Reserve officials have also confirmed their hawkish outlook, indicating that the Fed might not be ready for an early rate cut. Traders could turn to the release of new economic data this week which could impact expectations and the trajectory of the dollar.
The Euro could see a limited performance this week as traders look forward to the European Central Bank’s meeting on Thursday. The central bank is expected to leave interest rates unchanged which could help support the euro to a certain extent.
The British Pound continued to trade in a range, stagnating for several weeks. While a stronger rebound in inflation could support the potential for the Bank of England to keep interest rates at high levels, traders could monitor new economic data ahead of the central bank’s meeting.