Investing.com - The U.S. dollar rose in early European trade Thursday as negotiations to end the debt ceiling standoff in Washington have yet to result in a deal, while more Fed officials are due. At 02:55 ET (06:55 GMT), the dollar index, which tracks the greenback against a basket of six other currencies, gained 0.1% to 102.845, near a seven-week high. President Joe Biden and top U.S. congressional Republican Kevin McCarthy have agreed to negotiate directly over the raising of the government's $31.4 trillion debt ceiling, after a months-long standoff. This has raised optimism that a deal can be reached to avoid a damaging debt default, but a cautious air has tempered risk-taking. “Markets are looking at the glass half empty in this situation, as expectations were probably for some more tangible progress towards a deal,” said analysts at ING, in a note. “We think that there is still room for appreciation until we get clearer indications that the two sides have gotten closer on core issues when it comes to debt-limit negotiations.” Traders will also focus on a slew of Federal Reserve speakers this week, most notably Chair Jerome Powell on Friday, for more cues on monetary policy. The U.S. central bank is widely expected to pause its rate-hiking cycle in June, but Fed officials have generally offered up a hawkish view on monetary policy this week, pointing to still elevated levels of inflation. EUR/USD fell 0.1% to 1.0832, near the previous session's over six-week low, ahead of a speech by European Central Bank President Christine Lagarde later in the session, although the U.S. debt story remains the prime driver. “1.0800 is probably a key benchmark level to gauge market sentiment about the US debt-ceiling story,” said ING. “We could see some good support at 1.0800, and a break lower could indicate the FX market moving more seriously to price in a U.S. default.” GBP/USD fell 0.2% to 1.2464, ahead of the release of the Bank of England’s quarterly bulletin. USD/JPY fell 0.1% to 137.50, with the yen bouncing after steep overnight losses, while AUD/USD fell 0.2% to 0.6645, as softer-than-expected labor data pointed to lesser economic headroom for the Reserve Bank to keep raising interest rates. USD/CNY rose 0.2% to 7.0151, crossing the psychologically-important 7 level against the dollar for the first time since early-December, as a string of weaker-than-expected economic readings for April pointed to a slowing recovery in the country.