• The USD is trading mixed to higher with the EUR pressured by concern about sovereign debt risks in southern Europe and falling equity markets, the Wall Street Journal reports that EU Parliament might not release the funds promised to Greece, cost of funding Greek debt rises, GBP trades near unchanged with downside limited by report of rising UK shop price inflation and that UK construction PMI rose to a 32 month, AUD trades lower despite report of better than expected Australian building approvals, commodity currencies pressured by falling equity and commodity markets with crude prices down over 5% in the last two days, CAD is trading at a five-week low, the VIX index jumped over 25% Tuesday reflecting a spike investor risk aversion, JPY drifts lower in narrow range trade with Japanese markets closed for holiday
• Focus turns to today's release of US ADP employment and non-manufacturing ISM
• Australia's March building approvals rose by 15.3% and housing sector approvals for March rose by 0.5%,AUD lower
• UK BRC April shop prices rose by 2% due to higher cost of food, April construction PMI rose to 58 from 53.1 last month, UK election polls suggest a Conservative Party victory, GBP unchanged
• EU final April services PMI improved to 55.6 from 55.5, March retail sales unchanged, ECB's Weber warns of potential serious contagion from Greece for other EU states, Germany's Merkel warned of financial contagion risk unless the debt crisis is stopped in Greece, she pledged to support Greece, Greek workers strike to protest Greek austerity plans, EUR lower
• Investor Jim Rogers says he expects the single EU currency could be dead within 15 or 20 years
• Challenger April job cuts fall 43% to near a four-year low, hiring likely to increase in the months ahead
• US equity markets set to open lower, European equities 0.5% lower, Nikkei closed for holiday

Upcoming Events

• US-Wednesday, April ADP employment will be released expected at 30k compared to -23k last month along with April non- manufacturing ISM expected at 56 compared to 55.4 last month
• CAN-Wednesday, no major Canadian economic is due for release today

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100505_US_Morning_Notes.pdf		60 Kb