| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 06:00 | Germany | Industrial Production s.a. (MoM) | February | 1.3% | 0.3% | 2.1% |
| 06:00 | Germany | Trade Balance (s.a.), bln | February | 27.5 | 25.5 | 21.4 |
USD appreciated slightly against most of its major counterparts in the European session on Monday as investors eagerly waited for a release of the U.S. consumer price index (CPI) report for March later this week, hoping to get hints on how soon the Federal Reserve will start interest rate cutting.
The U.S. Dollar Index (DXY), measuring the U.S. currency's value relative to a basket of foreign currencies, rose 0.05% from the previous close to 104.35.
Last week’s strong March jobs report added to evidence that the U.S. economy remains resilient, suggesting no urgency for the Fed to start easing its policy. Against this backdrop, many investors trimmed their forecasts for a rate cut at the Fed’s June meeting. According to the CME FedWatch Tool, markets are now pricing in only 51.8% probability for a June rate cut by the U.S. central bank, down from 73.4% a month ago.
In addition, speculations raised that the Fed might reconsider its projections of three rate decreases for this year.
Many market participants argue that the March inflation report, slated for Wednesday, will be more important for the Fed’s policymakers and could determine the number of rate reductions and whether they begin in June or later.
Economists expect Wednesday’s release of CPI data will show further evidence of gradual easing in price pressures in March, with the core inflation measure coming in at 3.7% YoY, down from 3.8% YoY in February. This would mark the smallest annual gain since April 2021.