01:00 Australia CPI, q/q Quarter II +0.4% +0.5% +0.4%

01:00 Australia CPI, y/y Quarter II +2.5% +2.5% +2.4%

01:45 China HSBC Manufacturing PMI (Preliminary) July 48.2 48.6 47.7

The dollar traded 0.3 percent from a one-month low versus the euro as weaker U.S. economic indicators bolstered the argument for the Federal Reserve to delay a reduction to its bond-buying program. Sales of new U.S. homes probably rose 1.7 percent to an annualized pace of 484,000 last month, compared with 2.1 percent growth in May, according to the median estimate in a Bloomberg News survey before today’s Commerce Department report.

The euro was supported before data predicted to show services and factory output in the region contracted at the slowest pace in more than a year. A euro-area composite index based on a survey of purchasing managers in the services and manufacturing industries improved to 49.1 in July from 48.7 the previous month, London-based Markit Economics may say today, according to economists. That would match the level in March 2012. A reading below 50 indicates contraction.

Currencies of Asia-Pacific nations including the Australian dollar and yen dropped versus the greenback after a private report showed China’s manufacturing shrank at a faster pace. The preliminary reading of 47.7 for a China Purchasing Managers’ Index released today by HSBC Holdings Plc and Markit Economics compared with the 48.2 median estimate a Bloomberg survey. June’s final reading was 48.2, with data below 50 indicating contraction.

EUR / USD: during the Asian session the pair fell to $ 1.3200

GBP / USD: during the Asian session the pair fell to $ 1.5350

USD / JPY: during the Asian session the pair rose to Y99.80

The calendar gets underway at 0658GMT, with the release of the French flash July services and manufacturing PMI data. The flash services PMI is seen at 48.6, with services at 47.5. Both are higher than the July final numbers, but perhaps not quite underlined French FinMin Moscovici's statement that the recession is over. At 0700GMT, the Spanish June PPI numbers will be published. The main flash PMI numbers continue at 0728GMT, when the German July PMI numbers will cross the wires. Analysts see manufacturing at 49.0 and services at 50.6. The composite eurozone data will cross the wires at 0758GMT. Analysts median expectations see the flash manufacturing data at 49.0 and the lash services data at 48.6. The latest ECB Bank Lending Survey will be released at 0800GMT, the same time Italian May retail sales data will be published. Italian sales are seen unchanged on the month. German Economics Minister Philipp Roesler will give a press conference in Berlin at 1350GMT. The French June jobless claims numbers are set to be released at 1600GMT.

There is a limited UK data calendar, with only the July CBI Industrial Trends numbers and the Q3 CBI Business Confidence data. The industrial sector's performance has been patchier than that of services, with the former struggling to generate significant growth. Analysts' forecast range, from a small sample, goes from an unchanged -18 to -10 for July's monthly order books. The latter would be well above the long-run average of -17 and point to expansion at the start of the third quarter.