Mario Draghi’s comments on Monday are helping support the euro, pushing the currency to a three-month high. Draghi spoke early on Monday, claiming that underlying inflation is set to rise in Europe as a result of a tightening labor market.

The labor market tightening will help boost wage growth in Europe.

The European Central Bank expects European inflation to be around 1.7% through 2020, with core inflation reaching 1.8% in 2020. Core inflation does not include energy and food.

An announcement earlier in the month that interest rates will remain unchanged is a bonus, as inflation continues to rise. Draghi claims that there’s a “relatively vigorous pick-up in underlying inflation.”

After his speech, the euro rose as well as Germany’s 10-year bond, which reached its highest level since mid-June, hitting 0.514.

The euro hit a three-month high against the dollar, as forex trading favored the currency over the greenback in early-morning trade. Trade war tensions weighed on the greenback, as U.S. President Donald Trump announced additional tariffs on China. China retaliated with their own set of tariffs and also cancelled a meeting with the U.S. this week, citing tariffs as the reason for the cancellation.

Early-morning gains of the EUR/USD have since subsided, with the pairing down –0.03%.

The dollar remained little changed earlier in the day, with investors expected to rally around the currency as the Fed meets to discuss policy. The Fed is widely expected to raise interest rates this week, with a high chance of an additional hike in rates in December.

The euro was weighed down even after the ECB reaffirmed their goal to keep rates at their current levels through the summer of 2019. Rates in the euro zone remain extremely low.

The euro rose as high as $1.1815 earlier in the day. Germany’s announcement that it resolved an issue with its spy-chief helped strengthen the euro further.

Brexit negotiations continue to dictate the direction of the sterling, which is up 0.35% against the USD. Hopes of a UK-EU deal helped boost the sterling and firm the euro on Monday. German officials helped support the sterling after comments that it’s still possible to hash out a Brexit deal by November.

Emerging-market currencies also kept the dollar back on the day. Analysts fear emerging market currencies will be subdued as a result of U.S.-China trade wars. Turkey’s lira also firmed, gaining 3% on Monday after Secretary of State Mike Pompeo said he was going to have official talks with Turkish officials involving a U.S. pastor, which has led to President Trump imposing tariffs on the country.