Euro fell in European trade on Monday against a basket of major rivals, resuming losses against the dollar and recouping from six-week lows amid mounting pressures.
Markets increasingly expect the European Central Bank to cut interest rates in April, while the Federal Reserve isn't expected to cut rates until March.
EUR/USD fell 0.15% to 1.0839, with a session-high at 1.0853, after rising 0.1% on Friday, away from a six-week trough at 1.0813.
Euro lost 0.4% last week, the second weekly loss in a row amid renewed concerns about the US-European interest rate gap.
European Rates
Following the latest ECB meeting and Christine Lagarde's remarks, the odds for an April ECB interest rate cut surged to 80%.
Lagarde said that an interest rate cut in the summer is possible while opening the door as well for an April cut.
US Rates
Recent US data and bullish remarks by Fed officials hurt the odds of early interest rate cuts in March as markets expected a 0.25% interest rate in May.
Rate Gap
The current US-Euro zone interest rate gap stands at 100 basis points, the lowest since May 2022, and was expected to shrink to 75 basis points in March, however as the odds of an early US interest rate cut faded, the gap could actually widen to 125 basis points.
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