EUR/USD Holds Steady around 1.0750 in Quiet Market Conditions

EUR/USD is maintaining a steady position near 1.0750 as it consolidates its pullback from Friday's movement in the early hours of Monday. The main currency pair is treading cautiously, influenced by a generally stronger US Dollar and US Treasury bond yields. Market activity remains subdued as investors brace themselves for upcoming events from the Federal Reserve (Fed) and the European Central Bank (ECB).

EUR/USD kicked off the new week on a positive note, making gains beyond 1.0750 during the European trading session. While the technical outlook suggests the potential for further gains in the near future, investors may adopt a wait-and-see approach ahead of key risk events scheduled for this week.

The prevailing risk-on sentiment in the market is making it challenging for the US Dollar (USD) to attract significant demand at the start of the week, which is providing support to EUR/USD. The Euro Stoxx 50 Index is up nearly 1%, and US stock index futures are holding onto modest gains during the early European session.

On Tuesday, the US will release May inflation data, with the Consumer Price Index (CPI) anticipated to show a 4.2% year-on-year increase, significantly lower than the 4.9% rise recorded in April. The second half of the week will see increased volatility in financial markets as the Fed and ECB announce their respective policy decisions on Wednesday and Thursday.

If Wall Street's main indexes gain bullish momentum after the market opens, the USD could remain under pressure, while a reversal could occur if the opposite scenario unfolds. However, without any high-impact macroeconomic data releases to impact the currency's valuation, the market is likely to focus on the central banks' announcements.

From a technical perspective, EUR/USD remains within a bearish channel, approaching significant resistance levels that may prompt a potential downward move.