The dollar was mixed at the beginning of the week, slightly lower against the euro at 1.3935 and higher against the sterling. US equities edged up higher with the Dow Jones and S&P 500 up by 1.0% and the Nasdaq higher by 0.85%. Meanwhile, crude oil and spot gold rebounded in the Monday session, higher by 1.8% and 2.1%, respectively.

The US economic reports released earlier today included December personal income, personal consumption, PCE, construction spending and January manufacturing ISM. Personal income in December edged out expectations, up 0.4% compared with an upwardly revised 0.5% from November while personal consumption increased by 0.2%, slightly less than forecast versus an upwardly revised 0.7% previously. The core PCE printed within expectations, up 0.1% on a monthly basis and up 1.5% on an annualized basis. The manufacturing ISM report in January was sharply higher than expected - its strongest reading since August 2004 at 58.4. The prices paid component also surged to 70.0, up sharply from 61.5 from December.

The economic calendar for Tuesday is light, with the release of December pending home sales and January vehicle sales in the afternoon. Pending home sales are estimated to reverse the steep 16.0% plunge in December, instead increasing by 1.0% on a monthly basis.

Foreign exchange traders will focus on monetary policy decisions from the Reserve Bank of Australia, the European Central Bank and the Bank of England this week. The RBA will announce its policy decision at 10:30 PM tonight with consensus estimates calling for a 25-basis point rate hike to 4.0%. The ECB and BoE are both seen leaving policy unchanged when they announce the results of their deliberations on Thursday. The key point of focus will be whether the Bank of England maintains its current bond purchase program at 200 billion pounds.

The key highlight this week will be the jobs data slated for release on Friday. Non-farm payrolls in January are expected to show 13k in jobs growth compared with a loss of 85k in jobs from December. The unemployment rate is expected to hold steady at 10.0%.

EURUSD hovers near 1.3920, with resistance seen at 1.3960, followed by 1.40 and 1.4040. Subsequent ceilings will emerge at 1.4025, backed by 1.4050 and 1.41. On the downside, support starts at 1.39, followed by 1.3870 and 1.3840. Additional floors will emerge at 1.38, backed by 1.3760 and 1.3730.