The euro rose against the dollar ahead of the publication of reports on German IFO, PMI index for the euro area and the minutes of the FOMC this week. As for the protocol, the markets will closely monitor the tone of statements for clues to limit QE. Many experts expect the key representatives of the Central Bank will sound confident about the program, but also recognize that markets may behold some "turbulence".

We add that the economic calendar today was nearly empty because of the holidays in European countries. It may be noted the data on orders in industry in Italy. In March of 2013 the volume of orders for production equipment in Italy rose by 1.6% compared to the previous month, when the decline was 2.5%, according to the Italian statistics agency Istat. The volume of orders for production equipment in March compared to March 2012 fell by 10%. Analysts had expected growth of the first indicator by 1.6%, and the second drop of 8.4%.

The yen rose against the dollar after Japan's Economy Minister Akira Amari said that a further reduction in the national currency could have a negative impact, after the yen fell to its lowest level since 2008 last week. The yen rose against all but one of the 16 major currencies on news that the Japanese government may be satisfied by the current exchange rate, after a significant decline in the yen earlier. In the Wall Street Journal it was reported that Japan's economy minister Akira Amari said that excessive strengthening of the yen largely corrected and further weakening may be harmful. Further reduction in the USD / JPY may depend on the results of the Bank of Japan on May 21-22, and the speech of the Chairman of the Federal Reserve Ben Bernanke in Congress on May 22. It is expected that the Bank of Japan will not even soften monetary policy, but it can make a "fine tuning" of current operations, to reduce the volatility of the bond market.

The pound rose significantly against the dollar after a report from Rightmove showed that in May, the cost of housing in the UK has increased, registering with the fifth consecutive monthly increase, which was due to the limited supply. According to the report, in May, prices rose, reaching a record high - 249,841 pounds, as new sellers raised prices by 2.1 percent compared to the previous month. Recall that, by the end of last month, prices have shown a similar increase. Meanwhile, studies have shown that taking into account the fifth monthly increase in house prices are now 9.1 per cent higher compared to last year, which is the highest increase since 2004.

The data also showed that property prices in the capital - London, were more than twice as much as the national average, and reached a record high. Note that the average home price rose in May by 3.3 percent to 509,870 while the British pound.

Among the regions that have achieved high growth rates in the last month, became the North of England (at £ 6182, or 4.2%) and the East of England (at £ 8909, or 4%).

On an annual basis, housing prices nationally rose 2.5 percent, which is much faster than the 0.4 percent increase registered in April. According to Rightmove, cheap loans and a positive mood began to release pent-up demand. We also add that the rise in house prices are a signal that the program of asset purchases and credit financing scheme of the Bank of England is the basis of recovery in the property market.

 A decline in U.S. industrial production during April sent a closely watched barometer of the economy to its lowest level since January.

The Federal Reserve Bank of Chicago on Monday said its National Activity Index fell to -0.53 in April from -0.23 in March, with three of its four constituent parts registering sequential declines.

Production-related indicators were the main laggards as their contribution fell to -0.34 in April from -0.04 in March. Consumption and housing fell to -0.17 from -0.15 as home starts dropped to 853,000 units in April from 1,021,000 in March, even though housing permits rose slightly.

Sales, orders and inventories were up slightly, but still in negative territory at -0.01 from -0.04. Employment-related indicators were neutral at zero, down from 0.01 in March.

Of the 85 individual indicators included in the compendium index, 44 improved in April while 41 declined. Of those that improved, 18 still remained in negative territory.

The more representative three-month moving average ticked up slightly to -0.04 up from -0.05 in March, indicating expansion close to the historical trend and low inflationary pressures. Last year at this time, the monthly average was -0.13.

EUR/USD

Offers $1.2950, $1.2930/40, $1.2910/25, $1.2890/900, $1.2880

Bids $1.2800, $1.2790-70, $1.2710/00

GBP/USD

Offers $1.5295/300, $1.5260/65, $1.5250, $1.5230/35, $1.5220

Bids $1.5160/50, $1.5130/20

AUD/USD

Offers $0.9900, $0.9880, $0.9845/50, $0.9830/35, $0.9790/00

Bids $0.9720, $0.9710, $0.9700, $0.9650, $0.9600

EUR/GBP

Offers stg0.8545/50, stg0.8530/35, stg0.8490-500, stg0.8480

Bids stg0.8430/20, stg0.8400

EUR/JPY

Offers Y133.50, Y133.00, Y132.75/80, Y132.40/50, Y132.20

Bids Y131.70/60, Y131.50, Y131.30, Y131.10/00, Y130.80

Offers Y104.00, Y103.50, Y103.30/35, Y103.15/20, Y102.90/00

Bids Y102.25/20, Y102.10/00, Y101.85/80, Y101.50

Option expiries for today's 1400GMT cut

EUR/USD $1.2750, $1.2800, $1.2825, $1.2840, $1.2850, $1.2860, $1.2900, $1.2930

USD/JPY Y101.50, Y102.00, Y102.50, Y103.00

GBP/USD $1.5150, $1.5300

EUR/CHF Chf1.2410, Chf1.2425

AUD/USD $0.9700, $0.9750, $0.9825, $0.9845, $0.9850

AUD/JPY Y101.00

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The yen climbed versus all 16 major peers after Japan's Economy Minister Akira Amari said further losses in the currency would threaten to negatively affect people and the government's job is to minimize that.

Wagers the dollar will gain against the euro and yen rose last week amid bets the Federal Reserve will signal a tapering of bond purchases. Fed Bank of San Francisco President John Williams said May 16 that quickening economic growth and gains in the job market may prompt the central bank to begin tapering its bond buying as soon as this summer. Williams was one of the first Fed officials to advocate open-ended bond purchases. Philadelphia Fed Bank President Charles Plosser said a week earlier he'd favor a June reduction.

New Zealand's dollar strengthened as its finance minister said home price gains will pressure the Reserve Bank to raise interest rates. "These households heading into quite high debt to buy highly priced houses need to be aware at some stage the RBNZ will increase interest rates, particularly if the housing market keeps growing at rapid rates," English said yesterday in an interview broadcast on Television New Zealand's Q+A.

EUR / USD: during the Asian session, the pair traded in the range of $ 1.2815-50

GBP / USD: during the Asian session, the pair traded in the range of $ 1.5165-00

USD / JPY: during the Asian session, the pair fell to Y102.60

Monday sees a very quiet calendar, with many European centres set to enjoy the Whitsun holidays, although markets remain open. The main focus for the week will be testimony on the Hill from Fed Chairman Bernanke and minutes from the Fed, RBA and BOE. The only event on the European calendar is the release of the Italian March industrial orders numbers. The US calendar is also light, with little on the calendar. At 1330GMT, the MNI Capital Goods Index for the May 17 week will be released, followed by the MNI Retail Trade Index data for the May 18 period. At 1700GMT, the Chicago Federal Reserve Bank President Charles Evans is scheduled to give a speech on the outlook to the CFA Society in Chicago. Late UK data sees the release of the April Markit Household Finance Index numbers at 2300GMT

07:00 United Kingdom MPC Member Tucker Speaks

09:00 France Bank holiday

09:00 Germany Bank holiday

09:00 Switzerland Bank holiday

12:00 Canada Bank holiday

12:30 U.S. Chicago Federal National Activity Index April -0.23