Dollar Extends Losing Streak

The dollar climbed to a three-week peak against the euro last week, buoyed by expectations that the US Federal Reserve, fresh from its recent rate increase, would tighten monetary policy again in September. Those expectations have since been tempered as key US economic data printed below forecasts. Highlighting the Central Bank's struggle, St. Louis Fed President James Bullard remarked on Friday that policymakers should wait on any further rate increases until inflation reliably heads towards the 2.00% mark.

Data on tap this week include June consumer confidence, a final reading of first quarter GDP along with pending home sales. In the meantime, EURUSD was last seen around the 1.11900-mark, with 1.1200 representing the key resistance level on the upside. If the pair breaks above, traders can expect additional weakness in the greenback to push EURUSD back towards mid-June highs.

Hurt by weakness in the services space, Germany's private sector grew at a slower than expected pace in June. Markit's flash PMI, which tracks manufacturing and services activity in Europe's largest economy, slid to a four-month trough of 56.1 in June compared to the 57.4 reading reported back in May.

The figure came in below the consensus forecast of economists but managed to remain well above the key level of 50, which separates expansion from contraction.  Markit is currently projecting 2.00% growth for the German economy this year - the highest rate of expansion since 2011. Nevertheless, despite the optimism, DAX futures are currently hovering around 12750, just below the key resistance at 12800 after sticking within a narrow range over the past few sessions.