• The USD is trading mixed as the UK Times reports of a possible crackdown on carry trades and Asian equities trade a three month low, the UK Times article sparked unwind of JPY carry trades in Asian trade, report that EU manufacturing PMI is at a two-year high limits EUR decline, GBP pressured by report that the MPC is split on whether to expand quantitative ease with four members reported to be calling for an enlargement of quantitative ease at this week's BOE policy meeting and in reaction to weaker UK mortgage approvals report, AUD rebounds from its lowest level since December supported by report of stronger than expected Australian house price data, CAD pressured by drop in consumer confidence, USD gains limited by report that US 2010 budget deficit will be at new record high
• Focus turns to today's release of US personal income, consumption, construction spending and ISM
• China may take action to further limit bank lending after the release of strong PMI data, fear of tightening of monetary policy in China pressured Asian equity markets
• Japan's Finance Minister Kan says Japan may need fresh policy efforts stop deflation, JPY lower
• Australia's Q4 house price index rose by 5.2%, new home sales fall by 4.6% in December, January TD/MI inflation rose by 0.8%, January jobs ads declined by 8.1%, AUD lower
• Sunday UK Times says UK monetary board split on question of adding to quantitative ease, UK FSA calls for possible crackdown on carry trades, FSA Chief Turner says carry trades are valueless, UK January manufacturing PMI rose to 56.7 compared to 54.6 last month, December consumer credit at 0.052bln, December mortgage approvals declined to 59,023 from 60,045 last month and December money supply declined by 1.1%, GBP lower
• ECB President Trichet says strong USD in interest of US and global economy, EU growth to remain modest in 2010, EU January manufacturing PMI rose to a two-year high of 52.4, EUR higher
• Swiss January PMI rose to 56 from 53.7 last month, CHF higher
• Canada's RBC consumer index dropped by two points to 106 reflecting job worries, CAD flat
• Bloomberg reports that investors are pulling cash out of EUR at a record pace diminishing the EUR attraction as a reserve alternative to the USD
• New York University professor Roubini sees "very dismal" US growth outlook
• US 2010 budget deficit forecast at a record $1.56trln
• CFTC commitment of traders from last week showed speculators increasing short positions in the EUR and adding to the long USD positions
• ECRI economic growth gauge fell to its lowest level since August, sees no risk of double dip recession, wage growth posts weakest increase on record, employment cost index increased by just 1.5% in 2009
• US equity markets set to open higher, European equities mixed, Nikkei closed 7 points higher

Upcoming Events

• US - Monday, December personal income and consumption will be released expected at 0.2% and 0.3% respectively along with December construction spending expected at -0.5% compared to -0.6% last month and January ISM expected at 55.5 compared to 55.9 last month
• CAN - Monday, no major economic data is due for release from Canada today

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