After yesterday's sharp pullback, dollar and yen are regaining ground as Asian stocks fail to hold on to early gains and turn red in late session. European and US stock futures are also pointing to weaker opens. Crude oil continues to hover below 60 level while Gold remains weak despite drawing some support at 905 level yesterday. The development so far did little to change the view that risk aversion is dominating the markets and in spite of yesterday's retreat, we'd continue to expect further strength in yen and, to a lesser extent, dollar.

Some weakness is also seen in Euro on news that more than 10 eastern European countries are applying for loans from IMF, including first-timers Bulgaria, Croatia and Macedonia. Ukraine, Serbia, Romania, Belarus and Latvia are asking for earlier payout or increase of the funding support while Hungary has not decided whether it needs additional funds yet.

SNB President Roth said the bank will stick to their policy in a decisive manner and emphasized that even though there is no set exchange rate target, the franc hasn't appreciated further: Roth said that further appreciation of Swiss Franc is not wanted as the bank must prevent deflation.

On the data front, Japanese domestic CGPI showed largest drop in history by -6.6% yoy in Jun. German WPI rose much more than expected by 0.9% mom in Jun. UK PPI is the main focus in European session. Input price is expected to rise 0.8% mom in Jun with output price rising 0.3% mom.

In early US session, Canadian employment report will catch most attention. Payrolls are expected to have reduced by 30K in June, following a 41.8K contraction in the prior month. With total labor force staying unchanged at around 18.4, unemployment rate likely rose to 8.6% from 8.4% in May. Pace of contraction in job loss should continue to slow down in coming months as economy in Canada seemed to have stabilized with decline. That said, the view that the nation's unemployment rate will rise to 9% by the end of the year remains intact. US Trade deficit is expected to widen slightly to 30b in May while import price index is expected to rise 2.0% mom in Jun. U of Michigan consumer sentiment is expected to drop slightly from 70.8 to 70.6 in July.