The euro fell against the U.S. dollar with the absence of economic data for the euro area. Note that many investors are waiting for the next meeting of the representatives of the European Central Bank, which will be held in Frankfurt on August 1. We add that the markets do not expect major statements by the central bank, except, perhaps, the indication, the ECB will keep rates at exceptionally low levels for the future. A few weeks ago, we thought that there is a small possibility that the ECB will lower its bid. However, recent data on economic activity in the euro area and Germany were better than expected. According to this, the ECB may argue that it will keep interest rates unless you need help. Thus, do not expect much from the ECB's interest rate or other, more unorthodox measures.

On the dynamics of trade also influence the expectations of the accompanying publication of the Committee's statement on the Federal Open Market. Markets expect the Fed hints at reducing the amount of time buying bonds from the current $ 85 billion a month.

It is worth noting that a small influence on the bidding had U.S. data. The National Association of Realtors (NAR) reported that by the end of last month the number of potential buyers who signed contracts to buy in the secondary market decreased slightly after the previous month reached its highest level in more than six years.

According to the report, the seasonally adjusted index of pending home sales in the secondary market fell in June to a level of 110.9, which is 0.4% lower compared to the previous month, and by 10.9% more than during the same period a year earlier. It is worth noting that according to the average forecasts of experts, the index was down by 1.1%, compared with growth of 5.8% in the previous month, which was revised from 6.7% growth.

The British Pound was lower against the U.S. dollar, which has been associated with the publication of a report by Britain. As it became known, in the UK, the number of mortgage approvals fell in June, despite the measures taken by the government and the central bank to facilitate credit conditions, the Bank of England data showed on Monday.

The number of loans for house purchase unexpectedly fell to 57,667 in June from 58,071 in May. According to forecasts expected to rise to 59,700 in June.

Loans secured on real estate (net mortgage lending) rose by 981 million pounds, higher than the 466 million that were a month ago. At the same time, consumer loans grew at a slower rate up to 489 million pounds compared to 781 million pounds in May.

Separately, the central bank said that the M4 money supply grew by only 0.1% in June compared with the previous month, when it remained unchanged. In annual terms M4 rebounded in June, rising by 1.5% after falling 0.1% in May.

In addition, data from the Confederation of British Industry showed that the rate of sales in July rose to 17 against the previous result 1. Analysts expect strong growth to less than 11.

The yen rose against most of its major counterparts amid falling stock market in Asia and fears of a slowdown in the world's largest economy. Additional support to the Japanese currency had a performance today Governor of the Bank of Japan Haruhiko Kuroda, who noted that the mitigation of monetary policy, which the central bank announced in April, the positive impact on the financial markets, the economy and inflation expectations. However, he warned that the Bank of Japan is still some way to go to achieve its inflation target of 2%. "Not all of these favorable changes are due to the softening of monetary policy in April, but the central bank is certainly an important factor," - Kuroda said at a press conference. In April, the Bank of Japan has taken unprecedented measures easing of monetary policy, which helped underlying index of consumer prices rise for the first time in 14 months.

European stocks closed little changed, trimming earlier gains, as companies from Danone (BN) to TNT (TNTE) Express NV reported results.

The Stoxx Europe 600 Index added less than 0.1 percent to 299.06 at the close of trading, having earlier climbed as much as 0.7 percent. The gauge slipped 0.3 percent last week as earnings from BASF SE and ABB Ltd. missed estimates while a survey of purchasing managers showed euro-area manufacturing unexpectedly expanded in July for the first time in two years.

National benchmark indexes advanced in 10 of the 18 western-European markets today.

FTSE 100 6,560.25 +5.46 +0.08% CAC 40 3,968.91 +0.07 0.00% DAX 8,259.03 +14.12 +0.17%

The Stoxx 600 has rallied 4.9 percent in July, the biggest monthly gain since October 2011, as the Federal Reserve said it remains flexible on the pace of asset purchases. Fed policy makers begin a two-day meeting tomorrow.

U.S. gross domestic product probably rose 1 percent on an annualized basis in the second quarter, after gaining 1.8 percent in the previous period, data will show on Wednesday, according to a separate survey of economists. Payrolls increased by 185,000 after a 195,000 gain in June, and the jobless rate fell to 7.5 percent from 7.6 percent, according to the median forecast of economists before Labor Department data on Friday.

Danone rose 3.2 percent to 59.27 euros. Second-quarter revenue growth topped analyst estimates as the company sold more baby-nutrition products in China and dairy sales climbed more than forecast.

Elan increased 3.7 percent to 11.55 euros after the Irish drug company agreed to be bought by Perrigo Co., a U.S. maker of over-the-counter medicines.

Royal KPN NV (KPN) rallied 4.6 percent to 1.98 euros. Billionaire Carlos Slim’s America Movil SAB ended an agreement with KPN that capped the Mexican company’s stake in the Dutch phone carrier at about 30 percent. If America Movil raises its stake above that threshold, it would have to bid for all of KPN’s shares, according to Dutch law.

Essilor International SA (EI) climbed 6.2 percent to 85.62 euros as the world’s biggest maker of eyeglass lenses agreed to buy full control of its Transitions Optical venture from PPG Industries Inc. for $1.73 billion to strengthen its tinted-products line.

TNT declined 4.6 percent to 5.86 euros, the largest drop since January. The company reported a second-quarter loss of 304 million euros ($403 million), after a profit of 39 million euros last year.

Barclays Plc (BARC) fell 3.5 percent to 309.05 pence as Britain’s second-largest bank by assets considers selling shares or contingent convertible bonds.

Oil prices rose slightly, to stabilize above $ 107 per barrel as a weaker dollar and concerns about supply disruptions were balanced concerns about global economic growth and the prospects for oil demand.

The data showed that the export of oil from a number of suppliers has decreased in recent weeks, stopping or reducing supplies from Libya, Iraq, North Sea and other places. Currently, the volume of deliveries fell by more than 500,000 barrels per day.

Analysts also point out that other providers, such as Sudan, may also fix the decline in exports in the coming weeks.

Production losses helped to support the market, causing concern about the prospects for fuel demand in a number of countries, including China, which is experiencing a slowdown in growth.

In addition, today it was announced that the proceeds of the Petroleum Exporting Countries on oil exports in 2012 reached a new record level. At the same time, some of the cartel profit declines on rising budget costs. Thus, if some oil-producing countries are benefiting from rising oil prices, the other members of the cartel do not get it, and this difference becomes more pronounced.

The disagreements within OPEC increase, and it is expected that later this year in the cartel will discuss the possibility of reducing the production of the official limit. If this decision is taken, the limit will be reduced for the first time in five years.

The annual statistical report of the OPEC states that the cartel's exports, including oil, gas condensate and oil products, in terms of value in 2012 increased by 9.2% to 1.261 trillion dollars, compared with the record high in 2011 at the level of 1.155 trillion dollars. Revenue Saudi Arabia grew by 6%, while revenues from Iran's oil exports fell by 12%.

The cost of the September futures on U.S. light crude oil WTI (Light Sweet Crude Oil) rose to 104.88 dollars a barrel on the New York Mercantile Exchange.

September futures price for North Sea Brent crude oil mixture rose to $ 107.35 a barrel on the London exchange ICE Futures Europe.

Gold prices fell slightly, which was due to profit-taking by investors after three weeks of growth. Note also that on account of market participants addressed a meeting of the Federal Reserve System, which will take place at the end of the week, and is expected to confirm the position of the conservation interest rates close to zero.

Gold prices fell 0.2 percent, after briefly turning positive earlier. Recall that last week, gold was back above the $ 1,300 that was the first time in a month. For the past three weeks worth of precious metals increased by 9%.

Experts note that many traders prefer to stay on the sidelines ahead of the Fed meeting. In general, the participants will continue to take profits rather than trying to open a "long position" until it subsides uncertainty around the timing of the program QE.

It should also be added that influenced the trading session could have the European Central Bank and the Bank of England, which is scheduled for this week and is expected to confirm previous recommendations.

We add that this year, the price of the precious metal lost a fifth of its value against the background of signs of recovery in the U.S. economy, which caused rumors about the end of the program to purchase assets. But Ben Bernanke's comments, which were announced this month, assured investors that the central bank will reduce monetary stimulus slow pace, and had a push gold prices. Investors, however, want to hear more specific comments on the exact timing of any changes in the program, and with great attention evaluate each piece of economic data to calculate when the Fed will act.

The cost of the August gold futures on COMEX today dropped to $ 1329.60 per ounce.

Pending home sales in the U.S. saw a modest decrease in the month of June, according to a report released by the National Association of Realtors on Monday, with pending sales pulling back off their highest level in over six years.

NAR said its pending home sales index edged down 0.4 percent to 110.9 in June from a downwardly revised 111.3 in May. Economists had been expecting the index to drop by about 1.4 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

EUR/USD $1.3100, $1.3125, $1.3150, $1.3200, $1.3220, $1.3250, $1.3300, $1.3350

USD/JPY Y97.00, Y97.35, Y97.40, Y97.65, Y98.00, Y98.20/25, Y98.30, Y98.40, Y99.50, Y99.75, Y100.05

EUR/JPY Y131.00

GBP/USD $1.5335, $1.5375, $1.5490, $1.5500

EUR/GBP stg0.8565, stg0.8630, stg8675

USD/CHF Chf0.9270, Chf0.9340, Chf0.9350, Chf0.9400

EUR/CHF Chf1.2350, Chf1.2450

AUD/USD $0.9215, $0.9240, $0.9250, $0.9275, $0.9350, $0.9360, $0.9375

AUD/JPY Y90.95

USD/CAD C$1.0200, C$1.0270, C$1.0280, C$1.0380

U.S. stock-index futures dropped  before a report that may show fewer Americans signed contracts to buy houses last month.

Global Stocks:

Nikkei  13,661.13 -468.85 -3.32%

Hang Seng 21,850.15 -118.80 -0.54%

Shanghai Composite 1,976.31 -34.54 -1.72%

FTSE  6,574.81 +20.02 +0.31%

CAC  3,981.89 +13.05 +0.33%

DAX 8,265.93 +21.02 +0.25%

Crude oil $105.12 +0.40%

Gold $1329.20 +0.58%

Sold E7.681bln vs target E6.5bln-E7.7bln 

- E3.99bln 3-month BTF, avg yield 0.04% (0.042%), cover 2.14 (2.01) 

- E1.994bln 6-month BTF, avg yield 0.066% (0.067%), cover 2.70 (2.40) 

- E1.697bln 12-month BTF, avg yield 0.145% (0.147%), cover 3.07 (3.51)

Business confidence in Italy increased notably in July from the previous month, and to a larger extent than economists had forecast, latest data showed Monday.

The seasonally adjusted business confidence index, which refers to manufacturers' assessment of their business conditions, advanced to 91.7 in July from the previous month's revised score of 90.5, statistical office Istat said.

Economists expected the index to move up to 91 from June's originally reported 90.2. In May, the reading was 88.8.

Among sub-sectors, entrepreneurs in the construction sector were more upbeat about their businesses in July. The corresponding indicator advanced to 76.5 from 71.1 a month earlier. Similarly, the measure of confidence in the market services sector moved up to 75.6 from 70.7.

Italian retailers were more confident in July about the prospects of their businesses than in June, with the corresponding indicator rising to 82.1 from 80.9 in the previous month.

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British retailers expect sales volumes to rise again in the year through August, after recording its first rise in five months in July, the latest monthly Distributive Trades Survey from the Confederation of British Industry (CBI) showed Monday.

The survey pointed out that 39 percent of firms expect an increase in sales volumes in August compared with 29 percent predicting a decline. This resulted in a rounded balance of 10 percent.

As much as 43 percent of firms reported that sales volumes were up on a year earlier in July and 26 percent said sales were down, yielding a balance of 17 percent. The balance was the highest since January 2013.

"The feel-good factor from the heatwave and early summer sales has helped boost high street sales, after a very weak start to the year," CBI Director of Economics Stephen Gifford said.

According to him, though a positive knock-on effect on retail sales from the royal baby has been mooted, continued good weather and discounts will play a greater role in retail growth over the next month.

EUR/USD

Offers $1.3340/50, $1.3320/25, $1.3300/10

Bids $1.3255/45, $1.3230, $1.3200, $1.3180, $1.3165/50

GBP/USD

Offers $1.5530, $1.5500, $1.5470/80, $1.5440/50, $1.5415/20

Bids $1.5330/20, $1.5305/00, $1.5280

AUD/USD

Offers $0.9380, $0.9360/70, $0.9345/50, $0.9300, $0.9285/90

Bids $0.9220, $0.9210/00, $0.9150, $0.9130/25, $0.9100

EUR/JPY

Offers Y131.50, Y130.90/00, Y130.75/80, Y130.50, Y130.20/30

Bids Y129.50, Y129.20, Y129.00

USD/JPY

Offers Y99.00, Y98.65/70, Y98.15/20

Bids Y97.50, Y97.10/00, Y96.50, Y96.25/20

EUR/GBP

Offers stg0.8700, stg0.8680/85, stg0.8665, stg0.8645/55

Bids stg0.8620, stg0.8600

European stocks gained for the first time in three days as companies from Danone to TNT Express NV reported results

The Stoxx 600 has gained 5.3 percent in July as the Federal Reserve said it remains flexible on the pace of asset purchases. Fed policy makers begin a two-day meeting tomorrow.

Danone, the owner of Evian bottled water and Activia yogurt, increased 3.1 percent to 59.24 euros. Second-quarter revenue growth topped estimates as the company sold more baby-nutrition products in China and dairy sales rose more than forecast.

Elan jumped 11 percent to 12.41 euros, the highest price in five years, after the Irish drug company agreed to be bought by Perrigo Co., a U.S. maker of over-the-counter medicines.

TNT declined 5.4 percent to 5.81 euros, the largest retreat since March 25. The company reported a second-quarter loss of 304 million euros ($403 million), after a profit of 39 million euros last year.

Ryanair Holdings Plc, Europe’s biggest discount airline, fell 2.5 percent percent to 6.99 euros as first-quarter earnings dropped 21 percent on higher fuel costs and an early Easter travel season.

FTSE 100 6,573.18 +18.39 +0.28 %

CAC 40 3,978.78 +9.94 +0.25 %

DAX 8,264.9 +19.99 +0.24 %

U.K. mortgage approvals declined in June despite measures taken by the government and central bank to ease credit conditions, data from the Bank of England showed Monday.

The number of loans approved for house purchases fell unexpectedly to 57,667 in June from 58,071 in May. It was forecast to rise to 59,500 in June.

Mortgage demand should continue to recover in response to the fall in mortgage rates, the Treasury's Help to Buy scheme and the strengthening recovery in the wider economy, said Samuel Tombs, an economist at Capital Economics.

But any recovery in housing market activity is likely to be modest and gradual, given that banks are still trying to improve their capital positions, Tombs noted.

Lending secured on dwellings increased by GBP 981 million, higher than a GBP 466 million lending seen a month ago, data showed.

At the same time, consumer credit increased at a slower pace, by GBP 489 million compared to GBP 781 million in May.

Separately, the central bank said M4 money supply grew only 0.1 percent in June from a month ago, when it remained flat. Annually, M4 recovered in June, up 1.5 percent, following a 0.1 percent drop in May.

EUR/USD $1.3020, $1.3050, $1.3100, $1.3200, $1.3220, $1.3300, $1.3350

USD/JPY Y97.00, Y97.35, Y98.25, Y98.30, Y98.40, Y99.50, Y99.75, Y100.05

EUR/JPY Y131.00

GBP/USD $1.5335, $1.5375, $1.5490, $1.5500

EUR/GBP stg0.8565, stg0.8630, stg8675

USD/CHF Chf0.9400

EUR/CHF Chf1.2350, Chf1.2450

AUD/USD $0.9240, $0.9275, $0.9350, $0.9375

USD/CAD C$1.0200, C$1.0280, C$1.0380

Asian stocks dropped, with the regional benchmark index heading for a fourth day of declines, after the yen strengthened and lenders fell. Resources shares slid after China’s industrial profit slowed.

Nikkei 225 13,661.13 -468.85 -3.32 %

Hang Seng 21,890.02 -78.93 -0.36 %

S&P/ASX 200 5,046.3 +4.27 +0.08 %

Shanghai Composite 1,976.31 -34.54 -1.72 %

Toyota Motor Corp. slipped 4.1 percent in Tokyo, pacing losses among Japanese exporters as the yen traded near a one-month low to the dollar.

Mitsubishi UFJ Financial Group Inc., Japan’s biggest publicly traded lender, dropped 4 percent, extending its biggest weekly decline in two months.

Jiangxi Copper Co., China’s biggest producer of the metal, fell 1.9 percent in Hong Kong.

The yen gained against its major peers as Asian shares sank amid concern about slowing growth in the world’s biggest economies, boosting demand for haven assets. Bank of Japan Governor Haruhiko Kuroda said it will take some time to reach a 2 percent inflation goal.

The dollar dropped to a one-month low versus Japan’s currency before a private report forecast to show sales of previously owned U.S. homes fell and the Federal Open Market Committee starts a two-day meeting tomorrow. An index of pending homes sales in the U.S. probably declined 1 percent in June from the previous month, when it increased 6.7 percent, according to the median estimate of economists surveyed by Bloomberg News before the National Association of Realtors releases the data today.

Economists in a separate Bloomberg poll estimate the Conference Board will say tomorrow its gauge of consumer confidence fell to 81 in July from 81.4 in June.

The Bloomberg Dollar Index touched the lowest in five weeks as investors weighed whether the economy is robust enough for the Fed to reduce stimulus.

The euro was supported before European Central Bank policy makers meet in Frankfurt on Aug. 1, following a pick up in factory activity this month. Germany led the first expansion in euro-area manufacturing in two years, according to surveys of purchasing managers published last week by London-based Markit Economics, lending support to ECB President Mario Draghi’s prediction of an economic recovery later in 2013.

EUR / USD: during the Asian session the pair rose to $ 1.3290

GBP / USD: during the Asian session the pair rose to $ 1.5405

USD / JPY: during the Asian session the pair fell to Y97.60

Markets remain lacklustre with attention on this week`s risk events, FOMC policy statement Wednesday, ECB and BOE rate announcements Thursday with the US employment report ending the week Friday. US Q2 GDP and ISM non-mfg will also be in focus.

08:30 United Kingdom Net Lending to Individuals, bln June 1.0 1.4

08:30 United Kingdom Mortgage Approvals June 58.2 59.7

10:00 United Kingdom CBI retail sales volume balance July 1 11

14:00 U.S. Pending Home Sales (MoM) June +6.7% -1.1%

22:45 New Zealand Building Permits, m/m June +1.3%

23:30 Japan Household spending Y/Y June -1.6% +1.2%

23:30 Japan Unemployment Rate June 4.1% 4.0%

23:50 Japan Industrial Production (MoM)  (Preliminary) June +1.9% -1.4%

23:50 Japan Industrial Production (YoY) (Preliminary) June -1.1% -2.9%