• EUR/USD has renewed its monthly highs at 1.0765 on the soaring market mood.
• Rising odds of a rate hike by the ECB have supported the euro bulls.
• The DXY has extended its losses after slipping to the weekly low at 101.65.

The EUR/USD pair is advancing sharply higher on broader weakness in the greenback. The pair has attacked 1.0760 and is expected to extend its gains further on a bullish open-drive set up in the Asian session. The shared currency bulls are driving the asset strongly higher right from the first auction. The asset has renewed its monthly highs at 1.0765 and bullish momentum is still intact.

The euro bulls are enjoying bids from the market participants on advancing expectations of the first rate hike announcement by the European Central Bank (ECB) in June. Price pressures are soaring over the last few months and the ECB has yet not stepped up its interest rates like the other Western leaders, which are not taking the bullet anymore. Dutch Central Bank head and ECB Governing Council member Klass Knot stated on Wednesday that inflation expectations will remain well-anchored at its upper limit and a rate hike by 50 basis points (bps) is not off the table.

Meanwhile, the US dollar index (DXY) has renewed its monthly lows at 101.43. The asset is falling like a house of cards on underpinned risk-on impulse in the market. The negative market sentiment has lost its traction and risk-perceived assets are scaling sharply higher. The asset has extended its losses in the Asian session after slipping below the weekly low at 101.65.

For further guidance, investors are awaiting the release of the US Personal Consumption Expenditure (PCE) Price Index, which is due in the New York session. The annualized figure is seen as stable at 6.65 while the monthly figure could slip to 0.8%.