Dollar remains broadly pressured in early US session as data from US provides little support. Personal income rose 0.4% in April while spending rose 0.4%. PCE core rose 0.2% mom, 1.0% yoy and headline PCE rose 2.2% yoy. The data are basically inline with market expectations. Dollar index breaches 75 level as mild strength in commodities and equities. Technically, such development indicates near term reversal in the index and we’d likely see more downside in the greenback ahead.

The Japanese yen weakens mildly today after Fitch cut its outlook on Japan’s sovereign debt rating from stable to negative. Fitch warned that the country’s “credit worthiness is under negative pressure from rising government indebtedness” and a “stronger fiscal consolidation strategy is necessary to buffer the sustainability of the public finances against the adverse structural trend of population aging”. Mean there “there is considerable downside risk for the public finances from the still-unknown cost of cleaning up the Fukushima nuclear plant” and “prolonged delays in restoring infrastructure could lead more Japanese corporate to consider relocating their activities abroad, leading to a greater permanent loss of output from the disaster, although it remains too early to gauge this effect”.

Other data released today saw Swiss KOC leading indicator rose to 2.3 in May. Eurozone confidence indicators were mixed while M3 money supply rose less than expected by 2.0% yoy in April. Japan core CPI rose 0.6% yoy in April, first rise in two years on a spike in energy and tobacco prices, retail sales dropped -4.8% yoy in April. UK Gfk consumer sentiment improved to -21 in May.

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