USD - Some interesting US data releases are onthe calendar this week. On Wednesday, ChairmanBen Bernanke will mark the end of the two?dayFOMC meeting by holding a press conference. Thestatement is expected to be in line with the softrhetoric seen from Bernanke since the lastmeeting, which has been further supported by theweak March jobs report. However, a much moreconsistent deterioration in labor marketconditions is needed for QE to return to the table. Furthermore, the so?called 'twist' program isanticipated to end on schedule in late June.Another major release expected this week is thefirst estimates for first?quarter GDP and privateconsumption on Friday. Modest privateconsumption growth of 2.1% q/q annualized and amoderate GDP figure of 2.5% q/q annualized isexpected. Moreover, we are due to get data fordurable goods orders for March. An unchangedreading in the wake of last month's large gain andthe zero?growth in industrial production is themarket's expectation. Finally, consumerconfidence measures are supposed to remainlargely unchanged, as the pressure from oil priceswears off. The University of Michigan confidencemay increase slightly to 76.0, while the conferenceboard confidence index may move down to 69.8from 70.2.

EUR - The euro is lower vs. the dollar as politicalworries ratchet up pressure on an alreadystruggling economy. The single currency fell tolows at $1.3103 as Europe's Purchasing Manager'sIndex (PMI) fell further into decline at 47.4 inMarch with Germany and France both reportingdeclines. Political turmoil is adding to the region'sdifficulties as France's President Nicolas Sarkozyfinished second to Socialist Challenger FrancoisHollande in the first round of elections, markingthe first time a sitting president is behind after thefirst round. The Dutch government is alsoteetering after Prime Minister Mark Ruttetendered his government's resignation as anopposition party refused to back big budget cuts,threatening to collapse the ruling coalition andpaving the way to new elections as early as June.An announcement by the IMF over the weekendto pledge an additional $430 billion in new fundingto aid distressed European countries was largelyovershadowed by political worries in Europe.With political instability added to the mix,pressure on the euro is building for a further testto the downside.

GBP - We open the week with sterling havingbroken through 1.6000 and currently trading at itshighest level against the dollar since last October;and the highest level against the EUR in 20months. Investors are seeking the relative safetyof the pound as political turmoil in theNetherlands coupled with the upcoming Frenchelections potentially derailing the efforts to stemthe European debt crisis have investors intobuying gilts. Also helping sterling is the beliefsthat the BoE will pause its stimulus plan afterstronger than expected inflation and retail salesdata this past week. This coming week brings GDP- expected at 0.1 after coming in last month at ?0.3.

JPY - JPY rose against all major currencies asconcern for French presidential elections andDutch government turmoil heightens. Yenstrengthening is largely a reflection of the ongoingdeterioration in investor's risk sentiment whichhas been resurfacing with concerns overEurozone's sovereign debt issues. Muchanticipated BoJ policy meeting is scheduled forFriday. Further easing from the BoJ is seen as anecessary measure in order to end deflation andstimulate growth. Inflation data will be releasedon April 26th, and expectations are for a slightincrease, however, still below the BoJ's recentlyannounced 1.0% target.

Commodity Currencies - Commodity currenciesweakened against the USD as soft commodityprices and the looming European economicuncertainty weighed down investor confidenceabout global growth. Despite the Bank of CanadaGovernor Mark Carney's repeated announcement,suggesting an interest rate hike, the CAD is loweragainst the USD. Domestically, the softer thanexpected Canadian Feb CPI of 0.4% m/m vs. theforecast of 0.5% and the y/y at 1.9% vs. 2.6%,weighed on the Loonie, advocating that inflation isrelatively contained in Canada and expectationsfor interest rate hikes before year?end may befaint. Meanwhile, the AUD is weaker against theUSD, despite China's flash HSBC PMI with rose to49.1. For the moment, the market may be drivenby the RBA which is pricing in rate cuts to 4.0% atthe next meeting on May 1st. Following the Aussie,the NZD is slid against the USD, as New Zealand'sCPI rose 0.5 percent in the 1st qtr, bringing annualinflation down to 1.6% from 1.8% from the 4th qtr2011. With little market?movement in NorthAmerican data, analysts are looking for overseaindicators for direction, which has weighed on risksentiment to the start off this week.

MXN - The Mexican peso was range?bound lastweek against the USD, trading between a high of13.30 to a low of 13.00. This morning, the pesofell by the most in a week as negative news in theEurozone sapped demand for emerging marketand high yielding currencies. On the data front,figures are showing a positive domestic growthwith Mexico's unemployment rate dropping downto 4.62% in March from the previous 5.33%, andretail sales in February rising 7.6% vs. the previous4.4%. Despite better?than?expected domesticdata, weak US and European economics will likelykeep the peso pressured in the near?term.

RMB - Prime Minister Wen Jiabao said China muststay the course on the market policies thatspurred its rise as an economic power, and thatremains key to catching up with more?advancednations. Economic policies pursued by China sinceits opening to the West more than 30 years agohave released immense potential in the society,Wen said in the English translation of his remarks.Wen said Europe's debt crisis isn't over and thepath to global economic recovery is full ofpotholes. China and Germany agree thatovercoming the crisis requires stable growth ofthe real economy, he said at the openingceremony with German Chancellor Angela Merkel.