- Spanish Unemployment Change (Spain, 08:00 GMT)
- Halifax House Price Index (MoM) (GB, Tentative)
- PPI (MoM) (EU, 10:00 GMT)
- ISM Manufacturing Index (U.S. 15:00 GMT)
Federal Reserve Chairman Ben S. Bernanke is betting the new U.S. economy is the same as the old one as he lays out arguments for more stimulus to revive it. He made that diagnosis last week in a rebuttal to those who blame an 8.3 percent unemployment rate on structural shifts in the economy wrought by the financial crisis and who contend joblessness is permanently elevated.
Bernanke’s challenge may be highlighted September 7, when economists surveyed by Bloomberg News predict Labor Department data will show unemployment exceeded 8 percent for a 43rd straight month in August as payrolls grew by 125,000, slowing from July’s 163,000 gain.
European leaders are stepping up shuttle diplomacy this week as they brace for their central banker’s plan to defend the euro from bond-market turmoil. European Union President Herman Van Rompuy is traveling to Berlin for talks with German Chancellor Angela Merkel today as Italian Prime Minister Mario Monti welcomes French President Francois Hollande to Rome. They were all given a hint about what may be in store when European Central Bank President Mario Draghi told officials yesterday he would be comfortable buying three-year government bonds to bring down borrowing costs for nations in financial distress.
Germany reiterated its support yesterday for Bundesbank President Jens Weidmann yesterday, following reports last week that he had considered resigning over his opposition to ECB bond purchases. Schaeuble warned investors not to expect too much from the ECB plan.
Schaeuble told Deutschlandfunk radio yesterday, “We have to be very careful that we don’t raise false expectations. It has to remain very clear, state debt can’t be financed through monetary policy. Therefore we can’t have a decision --we would think it very wrong -- that’s not covered by the ECB mandate.”
EUR/USD: The EUR/USD was trading at 1.26099 at the time of writing on speculation European Central Bank President Mario Draghi’s plan to buy bonds of debt-saddled nations in the region, despite weak manufacturing data surfaced in Europe as well as in China.
Market sentiments remain positive on the EUR as Australia’s dollar halted a decline from yesterday after the nation’s Reserve Bank left its benchmark interest rate unchanged and before European Union President Herman Van Rompuy meets with German Chancellor Angela Merkel today in Berlin for talks and Italian Prime Minister Mario Monti welcomes French President Francois Hollande to Rome. The European Central Bank President Mario Draghi told officials yesterday he would be comfortable buying three-year government bonds to bring down borrowing costs for nations in financial distress.
If the ECB really does buy bonds with up to a three-year maturity, that would be a positive surprise for the euro. On the other hand, growing hopes that the Federal Reserve Chairman Ben S. Bernanke will use easing tools to boost the U.S economy are weighing on the USD. Events likely to bring some fluctuations on the market are; Spanish Unemployment Change at 08:00 GMT, PPI (MoM) data in the eurozone and ISM Manufacturing Index in the U.S at 15:00 GMT.
Investors should closely watch all the economic data and news/headlines of the European leaders meeting today to better assess the trend of the EUR/USD. The resistance level is at 1.26690 and the support level is at 1.25648. 
GBP/USD: The GBP/USD was trading slightly higher at 1.58848 at the time of writing after an industry report showed U.K. manufacturing shrank less than economists forecast, damping speculation the Bank of England will increase monetary stimulus. Trading seems sticky on the market as investors are awaiting the Halifax House Price Index (MoM) in U.K and the ISM Manufacturing Index in the U.S, the two risk events for the pair to get some visibility. Moreover, investors are waiting for headlines from the European leaders meeting for further indication on the trend of pair.
The greenback remained under pressure after Federal Reserve Chairman Ben Bernanke said he would act as needed to boost the U.S economy. However, Investors should remained cautious ahead of the ECB’s policy setting meeting on Thursday, amid speculation that the bank is working on measures to help stabilize the eurozone's sovereign debt markets. The resistance level is at 1.59311 and the support level is at 1.58457. 
Oil (WTI): Oil climbed to the highest intraday price in more than a week on speculation central banks will take more steps to boost economic growth. The commodity was trading at 97.150 at the time of writing after disappointing Chinese manufacturing data sparked talk Beijing will loosen monetary policy to spark more robust growth. Market sentiments remain bullish on oil as Draghi may unveil details of his bond-purchase program when he holds his first press conference after the summer break on September 6 and the Federal Reserve will hold a monetary policy meeting on September 11-12.
Many investors in global energy markets continue to believe the U.S. central bank will announce a third round of bond buying. Monetary stimulus tools tend to weaken the dollar by design, pushing down interest rates and sending commodities prices rising, especially oil. Today, investors will closely watch the economic data which will be released in the eurozone and the U.S as well as headlines from European leaders meetings as European Union President Herman Van Rompuy is traveling to Berlin for talks with German Chancellor Angela Merkel today as Italian Prime Minister Mario Monti welcomes French President Francois Hollande to Rome. The resistance level is at 98.319 and the support level is at 96.041. 