HONG KONG, June 6 Reuters The yen was on the back foot on Monday and the dollar held firm against most peers ahead of a busy policyfocused week in which inflation is in the spotlight with a major European Central Bank meeting and U.S. consumer price data scheduled.

The dollar climbed to 130.99 yen in early trade, a fresh onemonth high, and not far from last month39;s 20year peak of 131.34, after gaining 2.95 last week.

It lost a little ground in the course of the morning to 130.7 yen.

The euro also climbed on the Japanese currency and hit 140.38 yen on Monday morning, extending a sevenyear high struck last week.

Barclays analysts attributed last week39;s softer yen to a recovery in risk assets, a rise in overseas yields, a stronger dollar and higher oil prices causing concerns about Japan39;s balance of trade.

The dollar index , which measures the greenback against six major peers, was at 102.06 after gaining 0.47 last week following good jobs and manufacturing data, snapping a twoweek losing streak.

Top of the agenda for many traders this week is Thursday39;s meeting by the European Central Bank, which is expected to prepare the ground for an interest rate hike at its July meeting.

There is some market speculation the ECB could start with a large 50 basis point rise, after euro zone inflation accelerated to yet another record high in May. 

Markets are currently pricing in 125 basis points of hikes at the ECB39;s four meetings this year.

With euro area inflation…