Anna 
On Monday, the dollar maintained its stability as investors awaited additional insights to gauge the U.S. interest rate trajectory, following cautious remarks from Federal Reserve officials, despite signs of cooling inflation.
The euro remained largely unchanged at $1.0871, hovering near the nearly two-month peak of $1.0895 reached last week. It has climbed 2% so far in May, buoyed by a weakening dollar in response to softer U.S. growth and inflation data, coupled with a resurgence in the euro zone economy.
Last week’s data revealed that U.S. consumer prices grew less than anticipated in April, leading markets to price in 50 basis points of Fed rate cuts for the year. However, subsequent statements from various Fed officials expressed caution regarding the timing of potential rate decreases, resulting in market pricing falling just below the 50 bp threshold.
The dollar index, tracking the currency against six major counterparts, saw a marginal uptick on Monday to 104.49. Since hitting a five-month high in April, it has depreciated by approximately 2%.
Neil Jones, a financial institutions FX sales professional at currency services firm TJM FX, highlighted the significance of numerous speeches from Fed officials scheduled for this week, which could influence market sentiment regarding interest rate cut expectations.
Sterling reached a two-month pinnacle of $1.2711 and remained near that level ahead of the UK inflation report slated for release on Wednesday.
The Japanese yen maintained stability at 155.73 per dollar, with traders monitoring for potential government intervention signals. Following a turbulent start to May due to suspected rounds of currency interventions by Tokyo to bolster the yen, the currency has traded within narrow ranges in recent sessions.
Jones also anticipated that the rally in gold and copper prices would bolster the currencies of commodity-exporting nations like Australia in the upcoming months.
The Australian dollar remained unchanged at $0.669 on Monday but has surged by 3.4% this month, partly due to Australia’s persistently high inflation.
Amidst concerns over geopolitical instability in the Middle East following a helicopter crash that claimed the life of Iran’s president and reports of health issues faced by Saudi Arabia’s king, oil prices experienced a slight increase on Monday.
