• EUR/USD is oscillating in a narrow range as investors await Eurozone Retail Sales for fresh cues.
• The risk profile is extremely negative amid escalating hawkish Fed bets.
• ECB members are advocating for two more interest rate hikes ahead.

The EUR/USD pair is displaying a lackluster performance below the round-level resistance of 1.0800 in the Asian session. The major currency pair has turned sideways, following the footprints of the subdued US Dollar Index (DXY). A volatility contraction in the USD Index is expected by the market participants after a one-sided vertical move on Friday.

S&P500 futures are showing losses in the Tokyo session, portraying a risk-off market mood. A minor military action in US-China has further trimmed the risk appetite of the market participants. The return generated by the 10-year US Treasury bonds has witnessed a minor decline but is still holding the 3.55% support.

Bumper United States Nonfarm Payrolls (NFP) data has faded the expectations that the Federal Reserve (Fed) will even consider a pause in its policy tightening spell. Considering an upbeat US labor market, Fed chair Jerome Powell might consider hiking interest rates further as the battle against stubborn inflation could be deadly ahead. For more clarity, investors will keep an eye over the speech from Fed chair Jerome Powell, which is scheduled for Tuesday.

On Eurozone front, after a bumper interest rate hike by the European Central Bank (ECB), the street is expecting that ECB President Christine Lagarde will continue hiking rates as the road to 2% inflation is far from over.

ECB policymaker Peter Kazimir said on Friday that “I don't think the March rate hike will be the last.” Also, ECB Governing Council member Pierre Wunsch supported the view of hawkish interest rate guidance, told Reuters on Friday that the ECB won't go from a 50 basis points (bps) rate hike in March to a zero in May. Wunsch added that a 25 bps or a 50 bps hike is possible in May.

Meanwhile, the Eurozone Retail Sales data will remain in focus. The economic data is expected to contract by 2.7% from a prior contraction of 2.8% on an annual basis.