The Dollar dropped against most of the major currencies during last week's trading session. The Dollar saw a 200 pips slide against the Yen, and a similar drop against the Pound. Throughout most of the week, the Dollar fell against the Euro as well. Yet it managed to rebound close to the weekend.

The Dollar's bearish trend came as a result of several poor U.S. economic indicators. The U.S. Trade Balance showed that the U.S. deficit has widened more than expected in November, mainly due to increased Oil imports. This shows that the imports are climbing in a faster pace than exports. Investors saw this result as a warning sign that the economy is yet to be recovering, and thus the Dollar began to slide. The U.S. Retail Sales data which were also released last week showed that the total sales at the retail level have decreased by 0.3%, failing to reach expectations for a 0.4% rise. This has added to investors woes that the American economy might not reach out of recession as soon as expected. In general, it appears that the Dollar becomes more fragile than usual lately, and the impact of each news release from the U.S. economy is becoming greater than usual.

As for the week ahead, several major economic publications are expected from the U.S. Traders are advised to follow the Long-Term Purchases on Tuesday, the Building Permits and the Producer Price Index on Wednesday and the weekly Unemployment Claims on Thursday.