The London session saw some impressive price action and the overall flavor was a much higher US dollar. Talk that the US fiscal stimulus package could total $775 billion and that about $300 billion will come via tax cuts looks to be putting a good near-term bid under the buck here. In that this would help the US economy beat others around the world towards recovery, it is very positive for the greenback.

EUR/USD got absolutely decimated and plunged -350 pips into the 1.3580 zone. GBP/USD was roughly -35 points lower towards 1.4510 and this was likely helped by UK construction PMI which came in at a weaker than expected 29.3 in December after a 31.8 print the prior month. The yen crosses were pushed around quite a bit and reflected most clearly the euro weakness and dollar strength. USD/JPY jumped 140 pips towards 93.40/50 while EUR/JPY slipped more than -120 pips into the 126.90/95 zone.

Upcoming Economic Data Releases (NY Session) previous forecast

* 1/5/09 15:00 GMT US Construction Spending MoM NOV -1.20% -1.20%

* 1/5/09 US Total Vehicle Sales DEC 10.2M 10.0M

* 1/5/09 US Domestic Vehicle Sales DEC 7.6M 7.5M