Dollar and yen are mildly higher as the week starts on risk aversion as Nikkei dropped -1.5% while MSCI Asia index dropped -1.7%. Focus turning to a number of manufacturing data from major countries today. Sterling pares some of last week's gain ahead of UK PMI manufacturing, which is expected to drop from 34.9 to 34.5 in Jan. Swiss SVME PMI is expected to drop from 36.9 to 36.3 in Jan. Meanwhile, Eurozone manufacturing PMI is expected to finalize at 34.5 in Jan. From US, ISM manufacturing index is expected to stabilize a bit after diving to the lowest level since 1980 of 32.9 in Dec and recovers to 33.1.

Also, we have a list of personal consumption data to be released in US session today. PCE index is anticipated to have slowed to 1.1% yoy in December from 1.4% in November with a peak at 4.5% in July. Excluding food and energy, core index for PCE in December should show a flat reading for the third month while the year-over-year reading is expected to have eased to 1.7% from 1.9% in the previous month. Economists forecast personal income in December to have plunged -0.4% mom, the second consecutive monthly decline, after falling -0.2% in November. Decrease in working hours should have weighed on wage and salary growth which were partly offset by higher transfer payment from the government. Personal spending should have contracted -0.9%, the 6th straight month of decline, in December. Construction spending is forecast to have dropped 1.2% mom in December, mainly driven by sever contraction in private residential construction while budget constraints in state and local government probably weighed on public construction, too.

Released earlier in Asia, Australia house price index fell -0.8% qoq in Q4 following a revised decline of -2.4% in Q3. On yearly basis, the reading plunged -3.3% in the fourth quarter after rising 1.6% in the previous quarter. Aussie remains soft on risk aversion.

Dollar index edges higher to 86.45 today and at this point, intraday bias will remain on the upside as long as 85.61 minor support holds. Break of 86.81 will confirm resumption of rise from 77.69 to 88.46 high. Below 85.61 will turn intraday outlook neutral first but recent rally should still be in force as long as the inner rising channel remains intact. Though, sustained trading below the channel support will indicate that rise from 77.69 has completed and will bring deeper decline to 81.19 cluster support next, will prospect of a retest of 77.69 to complete the consolidation that started at 88.46.