Major currencies moved into narrow ranges against each other as the trading week got off to a quiet start, with the dollar steady at lower levels ahead of some key US data this week While broadly stable, the dollar continues to trade with a softer tone after failing to sustain initial gains on Friday's jobs report, said Daniel Katzive at UBS A forecast beating non-farm payrolls number, to the tune of 243,000, helped the dollar rise to a week high against the euro on Friday but the US currency has been drifting lower since then "Friday's solid US payrolls headlines and strength in average earnings growth have boosted Fed tightening expectations further," added Katzive The combination of improving interest rate expectations and the healthy risk appetite among investors was quite supportive of the US currency in 2005. Now however, the dollar is finding it harder to make further headway, suggesting that there is also growing focus on the structural problems facing the economy "Moreover, with a fair amount of Fed tightening now priced in, the US currency remains more vulnerable to downside surprises than upside surprises," said Katzive US data this week will be key the dollar's fortunes. Among the key US data scheduled for this week are the US retail sales numbers for February on Tuesday and US inflation numbers for February on Thursday. Additionally, the US Treasury report on portfolio flows into the country are scheduled for Wednesday. This will show if the US will be able to cover its foreign funding needs through long-term portfolio flows "We are sceptical and see the dollar coming under pressure," BNP Paribas analysts said Separately, the euro found some demand from expectations of rising interest rates in the area after a series of strong data suggesting that overall economy is indeed recovering. The market expects that the German ZEW sentiment survey, due tomorrow, will point to a further recovery in Europe's largest economy and bolster the case for further rate increases Neil Mellor at Bank of New York also pointed to greater purchases of euros by foreign central banks as another reason for the single currency's gains. He cited UAE central bank governor Sultan Nasser al-Suweidi's comments about converting a greater proportion of the bank's dollar reserves into euros "Indeed, whenever a central bank figure ponders re-jiggling its reserves there is ever the fear that other neighbouring central banks are contemplating likewise," added Mellor The pound, meanwhile, was steady at lower levels against both the dollar and euro after some mixed UK data Official figures showed that while input prices were stable on the month, factory gate prices rose for the third month in a row, coming in slightly above analysts' expectations Meanwhile, government statistics on the housing market showed UK house prices rose 4.3 pct in January from a year earlier, well above the 3.1 pct forecast by analysts While these are both secondary data, they will give further encouragement to the BoE's Monetary Policy Committee to leave interest rates on hold at 4.50 pct in the coming months, especially as recent hawkish rhetoric from the MPC has suggested the majority are not convinced of the need for a rate cut. "At the margin today's update on producer and house prices were hawkish for the interest rate debate," said John Butler at HSBC.