The euro traded above the $1.14 level after a recent slide that pushed the common currency to its weakest point since last July, as the US dollar strengthened broadly amid escalating tensions in the Middle East. On Monday, Israeli officials indicated that the country is preparing for a potential escalation in its conflict with Iran in the coming days, warning the war could continue for “several more long weeks.” Meanwhile, oil prices have remained above $100 per barrel, underscoring Europe’s ongoing vulnerability to energy shocks. Attention is now shifting to the upcoming policy meeting of the European Central Bank on Thursday. Traders expect President Christine Lagarde to outline how the central bank intends to protect the eurozone economy from inflationary pressures linked to the conflict and surging energy prices. Money markets are currently fully pricing in a ECB rate hike by July, with roughly an 85% probability of a second increase by the end of the year.