Amid further hawkish statements on European interest rates and market pricing for a less aggressive Federal Reserve, the dollar was poised at a fourth straight session of losses against the euro on Monday.
The euro advanced marginally, reaching $1.0870 and drawing closer to its nine-month high of $1.08875.
ECB governing council member Klaas Knot bolstered the euro with his comment that interest rates would increase by 50 basis points in both February and March and continue rising in the months after.
The comment by Knot, who is known as a hawk among policymakers, was interpreted as a rebuke of recent predictions that the ECB might reduce its rate of rate hikes to quarter-point beginning in March.
Futures, on the other hand, have priced out nearly any likelihood of a 50 basis point hike by the Fed next month and have steadily dropped the expected peak for rates from the current 4.25% to 4.50% to 4.75% to 5.0%.
With weaker inflation, consumer spending, and housing statistics, investors have priced in approximately 50 basis points of U.S. rate cuts for the second half of the year.