U.S. consumer spending is expected to remain virtually unchanged in March from February. In February spending had risen by 0.7%. Saturday's report showed that U.S. gross domestic product had expanded at a 2.5% annual rate. Most economists had expected a 3% gain.
The Federal Reserve is to start a two-day meeting on Tuesday. Currently the Fed is purchasing $85 billion of bonds a month in an effort to raise downward pressure on borrowing costs. Minutes released after the Fed's last meeting in March, had shown that policy makers had though considered, at that stage, slowing purchases during 2013.
Although the Dollar has strengthened by 2.8% since January, most analysts expect that it will be under pressure, especially while U.S. bond yields stay low, and it's unlikely that the Fed will this week make any changes to policy.
Earlier today the Dollar slid 0.4% to 97.68 Yen and by 0.1% to $1.3046 per Euro. The Euro dropped by 0.3% to 127.41 Yen.
The Yen had fallen recently as expectations remained of raised monetary stimulus by the Bank of Japan (BOJ).
The Yen usually strengthens in times of financial or economic turmoil mainly because Japan's is not reliant on foreign capital in order to fund its deficits.
Today, the Yen rose against its major counterparts following the release of a Chinese report which showed that there had been slowing profit growth in industrial companies. This has supporting demand for haven assets.
Today and Friday, the 3rd May, Japanese markets are closed for holidays. Markets in China too are shut today until Thursday.
In Europe, Enrico Letta was sworn in on Sunday as Italy's prime minister. He forged an alliance with Silvio Berlusconi and so has put an end to two months of political stalemate.
The European Central Bank (ECB) is expected to cut borrowing costs by 25 basis points at its meeting this Thursday. Currently rates are set at an all-time low of 0.75%.
On Saturday the Bundesbank criticized the ECB's bond-buying plan saying "Rising sovereign bond yields cannot be used definitively as an explanation for a disturbance of monetary policy transmission."
The ECB started the plan it calls the Outright Monetary Transactions program last September. Since then Bond yields in Spain and Italy have dropped.
Should the ECB not make any progress to improve "the transmission mechanism and aid the pass through from further stimulus to the periphery" the market could be disappointed, by interpreting that as suggesting that the ECB may be short of options.