The dollar faced renewed selling pressure against the euro on Monday, driven by growing anticipation of interest rate cuts by the Federal Reserve. The euro climbed to a session high of $1.4725 before retreating slightly to $1.4710 in afternoon trading.

Market sentiment suggests a higher probability of a rate cut at the Fed’s upcoming meeting. This expectation is largely fueled by concerns surrounding the health of the U.S. economy, particularly within the housing and credit markets.

Analysts noted that weaker-than-expected economic data releases have further solidified the perception of a potential rate cut. Investors are closely scrutinizing upcoming economic indicators for confirmation of this trend.

The dollar’s weakness extended beyond the euro, with losses also recorded against the Japanese yen and the British pound.

The prospect of lower interest rates in the U.S. makes dollar-denominated assets less attractive to foreign investors, contributing to the currency’s decline.

Currency traders are awaiting further signals from the Federal Reserve regarding their monetary policy outlook. The central bank’s assessment of the economic situation will be crucial in determining the dollar’s near-term trajectory.