Ella 
EUR/USD rose slightly in early Asian trading on Monday. EUR/USD was boosted by a weaker US dollar and maintaining risk appetite. With U.S. markets closed for the Martin Luther King Jr. holiday and a lack of important U.S. economic data, risk sentiment is expected to remain the main driver of EUR/USD price action. EUR/USD is currently trading around 1.0953, up 0.03% on the day.
European Central Bank (ECB) officials stressed the need to wait for more economic data before making a decision on normalizing interest rates. On Saturday, ECB chief economist Philip Lane said the central bank would have important data before June to decide whether to launch a series of rate cuts, but that premature action could be counterproductive. . Last week, ECB President Christine Lagarde said that the “most difficult and worst period” regarding inflation may be over and that the ECB would cut interest rates if it was convinced that inflation had fallen below 2%.
In the United States, the U.S. producer price index (PPI) unexpectedly fell in December, raising the possibility that the Federal Reserve (Fed) will start cutting interest rates this year. Data released by the U.S. Bureau of Labor Statistics on Friday showed that the annual rate of producer price index increased by 1.0% in December from 0.8% in November, while the core producer price index was flat that month, with the annual rate of increase falling from 2.0% to 1.8%. Investors expect more easing monetary policy through 2024 amid signs of cooling inflation. Markets are betting the Fed will cut interest rates by 160 basis points this year.
