European Central Bank policymakers continue to push back against expectations for early interest rate cuts, which lends support to the EUR/USD pair.
ECB's Robert Holzmann said on Friday that the main risk to rate cuts is the Red Sea tension and that it is better to cut interest rates later than to do so too early.
Adding to this, ECB's executive board member Isabel Schnabel noted that monetary policy has had a weaker impact on dampening demand for services.
Furthermore, ECB policymaker and Bundesbank Chief Joachim Nagel said that it is too early to cut interest rates as the price outlook is not yet clear enough.
Separately, ECB President Christine Lagarde said that bargaining rounds in the first quarter will be key for the upcoming decisions on interest rates.
Retreating US Treasury bond yields fail to assist the US Dollar to build on last week's recovery from its lowest level since early February and further lends support.
The FOMC meeting minutes, along with hawkish remarks by several Federal Reserve officials, reaffirmed bets that the US central bank will keep rates higher for longer.
The Bundesbank, in its latest monthly report, warned that the German economy is likely in recession and might keep a lid on any further upside for the currency pair
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