Euro awaits Boss Lagarde's speech

The EUR/USD pair trades on a stronger note around 1.0860 during the early European trading hours on Tuesday. Investors will focus on Fedspeaker amid the absence of key US data releases. On Wednesday, European Central Bank (ECB) President Christine Lagarde's speech and the minutes from the recent FOMC meeting will take center stage.  
 
The Federal Reserve (Fed) officials are confident to say inflation is heading to the 2% target after the US inflation report last week. Fed Vice Chair Philip Jefferson said on Monday that it’s premature to tell whether the recent slowdown in the disinflationary process will be long-lasting, highlighting that he will be carefully assessing incoming economic data and the outlook. Meanwhile, Atlanta Fed, Fed Vice Chair Michael Barr stated that disappointing first-quarter inflation data did not provide the Fed with the increased confidence to support easing monetary policy.”  
 
The US central bank is expected to hold the rate steady at its June meeting. Traders are pricing in a 76% chance of a rate cut from the Fed by 25 basis points (bps) in September and two cuts by the end of the year, according to the CME FedWatch Tool.  

 Across the pond, the European Central Bank (ECB) is anticipated to lower its borrowing costs in the June meeting. The ECB board member Isabel Schnabel said the central bank may cut the rate in June, but warned about further cuts in borrowing costs given uncertainty over the outlook. Analysts believe the monetary policy divergence between the ECB and Fed might weigh on the Euro (EUR) and create a headwind for the EUR/USD pair.