The USD may weaken further
Little data out on Friday changed investor sentiment going into the weekend with US inflation coming in unchanged at 1.1%. The Reuters Michigan Consumer Sentiment Index also came in quite weak on Friday afternoon at 66.6, lower than the expected 70.3 and shows a drop in consumer confidence in the US.
A much quieter start to the week this week with most currencies trading pretty close to where they were on Friday afternoon with quite a quiet day for data as well today.
Today we only have UK money supply figures and UK mortgage approvals, expected to come in slightly lower than previous figures and shows that we are still not seeing the pick-up in house purchasing which has been very weak since the start of the UK recession.
Looking forward to tomorrow and we have the US Fed decision which could shed some more light on the possibility of an extension of the US quantitative easing currently in place. If the QE measures are increased then this would hurt the already struggling USD.