RTTNews - The dollar remained on the defensive versus other major currencies Monday morning in New York, extending a brutal stretch that has seen the buck collapse on speculation the global recession is losing force.

When traders were fleeing the markets in search of a safe haven months back, the dollar soared to multi-year highs. However, now that risk appetite is back, traders are looking for riskier assets and currencies supported by higher commodities prices.

Monday will see the release of pivotal personal income and spending data. The markets will be looking for evidence that renewed consumer confidence has translated to consumer spending.

Economists estimate the report, which is due out at 8:30 AM ET, to show that personal income fell 0.2% and the personal spending also declined 0.2% in the month. On Friday, traders digested a revised May consumer sentiment report from Reuters and the University of Michigan that showed its best results in eight months.

The dollar slumped to a new 5-month low versus the euro, dropping to 1.4245. The bottom fell out on the dollar last month despite concerns about the capacity of the euro area to join any economic recovery.

The dollar was hammered yet again by the resurgent pound sterling, dropping to a 6-month low of 1.6431. With the loss, the dollar moved further away from January's 23-year high of 1.3501.

The price of crude jumped above $68 a barrel Monday morning, driving the dollar closer to parity with its petro-linked Canadian counterpart. The buck slipped to an 8-month low of 1.0782, having dropped more than 20 Canadian cents since early March.

Against the yen, the dollar eased to 94.95. The pair has seen choppy trading of late, with both currencies coming under pressure against other majors.

US stock futures soared this morning, fueling more risk appetite and hurting the dollar. The Obama administration said it will provide $30 billion in financing to troubled automaker General Motors, which will reorganize through a bankruptcy filing.

Overseas, in further signs that the worst of the recession is over, the decline in Eurozone and UK manufacturing activities moderated again in May.

Monday, reports said citing data released by the Markit Economics that the manufacturing purchasing mangers index or PMI rose to a seven-month high of 40.7 in May from 36.8 in April and from the flash reading of 40.5. That was the biggest monthly increase in the survey's 12-year history.

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