The Fed last week sought to restore the slipping economy and hence surprisingly called on an emergency cut by 75bp hoping that it will revive the current situation. Many expect a further cut at the Fed's regular meeting ending Wednesday. Consequently, traders are looking for hints ahead of the meeting as to whether expectations will come true and by how much the cut will be.

The question now remains of what the ECB is planning to do when it next meets. ECB officials so far have stated that they do not plan to follow the Fed in cutting rates. As for now, the euro continues its uptrend against the US dollar dragging the pair with it to record a high of 1.4729 and a low of 1.4659.

The Bank of England must cut interest rates sharply or watch and examine the UK economy to avoid growing through a similar US down path to a major downturn. The evidence from the housing market is worrying.

Consumer confidence is low in the UK and rates cut are restrictive at this current time due to bad inflation outlook. The sterling is trading high against the US dollar, dragging the pair with it to the upside to record a high of 1.9866 and a low of 1.9730.

Monday morning, the Japanese yen rose against its counterparts as a slump in Asian stocks spurred unwinding of carry trades. Against the US dollar, the yen inclined pushing the pair to the downside to record at the hour of this report a low of 105.98. 

Asian stocks slumped as recession fears loomed and nervousness ahead of the US FOMC meeting scheduled to start tomorrow.

As for economic indicators, the week will be eventful: US home sales and job report will be announced, and fisrt 4th quarter GDP reading followed by the FOMC meeting ending Wednesday and finally the week will end by the OPEC meeting on Friday and will be an absolute essential point as well considering soaring inflationary threats in all nations across the globe.