The Dollar starts the week on the back foot today after several days that saw the US currency losing value against its peers. On Friday the release of the inflation and retail sales data from the US was not enough to give Dollar the boost investors were hoping for and now the currency finds itself on the defensive. Inflation is a problem for the US economy and as long as it remains at stubbornly low levels the central bank finds it difficult to justify further rate hikes, especially next year.

At the end of the week the focus will remain on the Dollar with two important reports for the US currency pending for release today. The greenback has been on a roller coaster ride during the recent sessions starting from weakness after the NFP report on Friday and the less bullish than expected FOMC minutes but saw some recovery yesterday as investors were bracing for today's figures. The main concern for the Fed is the low inflation as the recent minutes from their last meeting revealed so today's Consumer Price Index report will be closely watched by investors and speculators alike.

The European majors are on the rise this morning following the release of the FOMC minutes last night that forced the Dollar to retreat across the board. The minutes from Fed's recent meeting indicated that even though most policymakers thought that another rate hike during this year is appropriate there were also a few among them that were worried about the low inflation. To be precise, the notion that the current low inflation environment might not be transitory is what worries the FOMC members and some of them also suggested that rate hikes might need to stop until progress in the inflation front is evident.

Investors' focus will shift back to the Dollar today ahead of the release of the FOMC minutes from the central bank's recent meeting that will undoubtedly shed more light on what the US policymakers have in mind regarding their next moves. The consensus in the market is that the tone coming out of the minutes should be bullish as the Fed has little reason to change their current view of the domestic economy following recent data that suggests the US market is fairing relatively well all things considered.