More dovish China news rattled the markets overnight and the yen remained the winner in London trading. China's announcement that they plan to slow steel and cement production has the market trading with an overall risk averse tone. European bourses have dipped down to flat for the day after some respectable gains early on. The selling was despite better economic data across the pond. UK home prices rose a better than expected 1.6% in August on the heels of a 1.4% add the prior month. Moreover, German consumer confidence printed a better than anticipated result of 3.7 for September. This was not enough to turn the market's pessimism.

Cable was one of the bigger movers and continued its slide from the 1.6250 highs towards a low at 1.6169. EUR/USD managed to recover from 1.4220 overnight lows to trade better bid near 1.4270 ahead of the NY open. Meanwhile, the yen crosses are trying to stage a comeback but remain heavy nonetheless. EUR/JPY continues to creep higher after bottoming at 133.14 while USD/JPY has been in consolidation mode for the past four hours between 93.80/93.60. Oil remained under pressure and slipped back below the $71 mark. This saw USD/CAD make another attempt for the 1.10 level, which still remains elusive. The pair should see strength above there.

The highlights in NY now are the second cut of US 2Q GDP and the usual weekly initial jobless claims. The market is forecasting a downward revision to GDP to -1.5% from a previously reported -1.0%. Initial jobless claims are expected to slip to 565K from 576K. Markets will continue to take their cue from data and better numbers should see the yen crosses recover higher still.