The EUR/USD pair traded within a narrow range on Monday as investors awaited key inflation data from the Eurozone and fresh comments from Federal Reserve officials. Market participants remained cautious after last week's mixed U.S. economic reports, with traders avoiding aggressive positions before receiving clearer guidance on the outlook for interest rates.

The euro found moderate support from expectations that Eurozone inflation could remain above the European Central Bank's target, potentially limiting the pace of future rate cuts. Meanwhile, the U.S. dollar continued to benefit from relatively resilient Treasury yields, as investors believe the Federal Reserve is likely to maintain a data-dependent approach despite easing inflation pressures.

Analysts expect volatility to increase once inflation figures are released later this week. A stronger-than-expected reading may strengthen the euro by reinforcing expectations that the ECB will keep policy restrictive for longer. Conversely, softer inflation could renew speculation of additional monetary easing and pressure the common currency.

From a technical perspective, EUR/USD remains supported above its short-term moving averages, with buyers monitoring resistance near recent monthly highs. Traders will also watch upcoming U.S. employment data and central bank speeches, which could determine the pair's next directional move during the week.