After last week witnessed the release of some positive inflationary data from the US economy which gave the dollar a significant push to the upside against major currencies, this week we are upon the release of other inflationary related data, and specifically the personal consumption expenditure which is expected to rise, giving further support to the dollar and push it to the upside once again.

Due to the approach of the end of the year, the trading volume in the markets is expected to be thin, while investors will prefer squaring positions and make profits after the huge losses the American dollar witnessed during this year, which will be a more supportive factor to the dollar until the end of 2007.

The euro is declining gradually since this morning against the dollar from its highest at 1.4452 till its lowest at 1.4330 until the hour of this report and those levels are the highest for the dollar against the euro in one and a half months. Therefore it is expected from the euro to enter a downside trend which will be conformed in case the European currency closes below the 1.4250 level.

Some economical data were released today from the European continent where the manufacturing PMI rose to 52.5 in December from the expected 52.3, and despite of this rise it did not leave any affect on the euro movement for today, while the PMI services for the same month was released at 53.2, which is worst than the previous reading of 54.1.

Despite the lack of economical data in the British agenda today, however the sterling movement was considerable due to the appreciation of the dollar, as the pound retreated from its highest at 2.0215 till its lowest levels in two months and a half at 2.0009.

Due to the thin trade volume levels and the sensitivity of the markets during this time of the year, the Japanese yen is weakening against the dollar, where the pair recorded its lowest at 112.81 which is a main support level that pushed the pair to move to the upside approaching the strong resistance level 113.50, by recording its highest at 113.45, especially after fears from the decline in the inflationary levels started flourishing once again in Japan bringing back into the memory the economical stagnation stage faced by the country before.

After the pumping of liquidity by central banks last week, any developments that will occur in the American economy will be closely monitored as for investors to draw a picture of the Fed's next step when deciding their monetary policy; so today the current account is expected to indicate to shrinkage of the trade deficit to 183.8 billion dollars in the third quarter from 190.8 billion dollar deficit recorded the previous time, while the NY manufacturing index is expected to decline to 20.0 in December from 27.4 previously; finally, analysts expectations indicate a rise in the net long-term money flows in October to 50.0 billion dollars from previously recording a total net flows of 26.4 billion dollars.