USD fell against other major currencies in the European session on Monday, as investors awaited the release of the crucial U.S. retail sales report for February later in the day, which would be the last important piece of data before the Federal Reserve March 18-19 policy meeting.
The U.S. Dollar Index (DXY), which measures the U.S. currency's value relative to a basket of foreign currencies, dropped 0.20% from its previous close to 103.51.
The U.S. February retail sales numbers due at 12:30 GMT are expected to provide insight into the consumers’ spending amid concerns about the impacts of President Donald Trump’s tariff and budget-cutting policies on the economy and inflation. Economists forecast a 0.7% MoM rebound in U.S. retail sales in February after a 0.9% MoM decline in January.
The Fed will announce the outcomes of its two-day policy meeting on Wednesday along with updated growth and inflation predictions. Markets widely expect the U.S. central bank to make no changes to its rates this week. They also believe that the Fed policymakers are likely to reduce their 2025 U.S. growth forecast and slightly raise their inflation prediction.
Apart from the Fed, the Bank of Japan and the Bank of England are scheduled to meet later this week. Both central banks are also widely anticipated to keep interest rates unchanged, given high economic uncertainty.