Euro firms on Ukraine hopes, Trump knocks Mexican peso and Canadian dollar

By Alden Bentley and Stefano Rebaudo

NEW YORK/MILAN (Reuters) -The euro rebounded connected Monday arsenic hopes for a Ukraine bid woody improved, and involvement complaint differentials moved against the dollar up of a perchance pivotal steer connected U.S. economical maturation successful the February payrolls study precocious successful the week.

The Canadian dollar and Mexican peso some deed one-month lows successful day commercialized aft U.S. President Donald Trump said 25% tariffs connected those countries would commencement Tuesday, without offering specifics.

Ukrainian President Volodymyr Zelenskiy received a lukewarm invited successful Britain aft his gathering with U.S. President Donald Trump ended successful catastrophe connected Friday, nudging the euro to a 16-day low. British Prime Minister Keir Starmer said connected Sunday that European leaders had agreed to gully up a bid program to contiguous to Washington.

The Kremlin said connected Monday that idiosyncratic would person to unit Zelenskiy to marque peace.

The azygous currency was up 0.89% astatine $1.0468, a spot beneath the day's precocious but good supra Friday's debased of $1.0359.

The azygous currency recovered enactment aft the midmorning merchandise of February's U.S. ISM manufacturing PMI that came successful astatine 50.3, beneath expectations and January's 50.9 reading.

The large scheduled events of the week look to beryllium Thursday's European Central Bank argumentation gathering and Friday's U.S. employment report.

Analysts said a imaginable bid woody successful Ukraine and a apt summation of fiscal spending by euro portion countries could supply a boost to aboriginal growth, supporting the currency.

European Commission President Ursula von der Leyen volition pass subordinate states connected Tuesday astir plans to fortify the European defence manufacture and the EU's subject capabilities, she said connected Monday.

Meanwhile, the parties successful talks to signifier Germany's caller authorities are considering rapidly mounting up 2 peculiar funds perchance worthy hundreds of billions of euros, 1 for defence and a 2nd for infrastructure, 3 radical with cognition of the substance told Reuters.

"The defence broadside of things is astir apt somewhat supportive," said Shaun Osborne, main overseas speech strategist astatine Scotiabank successful Toronto.

Osborne said a smaller-than-expected autumn successful euro portion ostentation besides helped underpin the euro by undermining the lawsuit for further ECB easing, though fewer uncertainty they volition chopped rates again.

Consumer terms ostentation successful the 20 nations sharing the euro fell to 2.4% twelvemonth connected twelvemonth successful February from 2.5% a period earlier, conscionable supra expectations for 2.3% and moving a measurement person to the European Central Bank's 2% target, information from Eurostat showed connected Monday.