The market starts the week with a sigh of relief as China's decision to refrain from raising rates fueled a rally in equity markets and dampened fears over the waning global recovery.

Chinese inflation accelerated by the fastest pace in nearly two years, and the reluctance from the PBoC to move on rates eased the jitters and fueled gains for haven assets and hedge against inflation. The decision supported the lingering positive sentiment that the recovery is still intact amid a flow of upbeat fundamentals.

Heavy data is to be released this week ahead of the approaching holiday festivities, where tomorrow the eyes will be on the FOMC and later on the EU's Brussels Summit. The market remains mixed and the euro is surprisingly holding grounds.

The dollar is trending slightly lower as the euro is holding its grounds and the ease of jitters ahead of the summit have supported the euro over its major counterparts, dragging the dollar lower. The dollar index is trading lower at this time around 80.09 areas after setting the high of 90.30 and slightly off lows at 80.05.

As for the common currency, the euro is trading to the upside and currently hovering around 1.3236 near its high at 1.3246 after setting the low of 1.3180. The euro extended the gains versus the yen as well recording the high of 111.48 and currently around 111.34 after recording the lows of 110.64.

The euro's strength also pressured sterling which is trading bearishly today, where the euro inclined to the highest at 0.8418 versus the pound after recording early lows of 0.8345. Sterling was also weak against greenback despite its losses, where the pair declined to set the lows of 1.5717 after failing to break above 1.58 areas in early trading and currently hovers around 1.5735.

With the upbeat start and easing jitters over the outlook for the recovery the yen also weakened versus its counterparts. The Dollar extended the gains versus the yen driving the pair higher, where the USDJPY recorded the high of 84.35 and the low of 83.87 and currently trading around 84 areas.