Euro Strengthens Amid German Inflation Data and Global Currency Movements

The euro appreciated on Monday following German inflation data. Commodity currencies rose on hopes for China's economic turnaround. The U.S. dollar hovered near a one-year low. Key upcoming U.S. non-farm payrolls data could influence future rate cuts. The Australian and New Zealand dollars hit highs, driven by China's stimulus measures.

The euro gained strength on Monday, buoyed by German inflation data. Commodity currencies surged on the back of China's anticipated economic turnaround, while the Japanese yen stabilized after a call for a snap election by Japan's new prime minister.

Traders are closely watching the U.S. dollar, which sits near a one-year low as upcoming non-farm payrolls data on Friday is expected to provide insight into the health of the U.S. economy. Recent rate cuts by the Federal Reserve have already pushed the dollar lower against most major currencies in recent weeks.

The euro was trading at $1.1194, up 0.3% after German inflation figures indicated easing price pressures. However, the currency remained steady against the pound. Investment banks have adjusted their European Central Bank calls, expecting consecutive rate cuts in October and December. Elsewhere, the Australian and New Zealand dollars reached 2024 highs due to Chinese economic stimulus efforts.

(With inputs from agencies.)