The euro rose against the dollar on Monday after the European Central Bank (ECB) hinted at additional interest rate increases to combat inflation. This move signals a commitment to tightening monetary policy within the Eurozone. Market analysts predict this trend will likely continue as the ECB prioritizes price stability.

The prospect of higher interest rates in the Eurozone makes euro-denominated assets more attractive to investors, driving up demand for the currency. Conversely, uncertainty surrounding the US Federal Reserve’s future rate decisions has weighed on the dollar.

The currency markets are closely watching upcoming economic data releases from both the Eurozone and the United States for further clues about the direction of monetary policy. Any surprises could trigger significant volatility in exchange rates.