The U.S. dollar was broadly firm

Good Morning,

- The euro hit one-year lows against the dollar to 1.3178, as investors increasingly expect the ECB to expand liquidity next week to boost the euro zone economy.

- The mood in the stock markets was buttressed by the S&P, which briefly topped the 2,000 mark for the first time in history yesterday. Japan's Nikkei -0.59%, Hong Kong's Hang Seng -0.21% (07:18 GMT), Korea's Kospi 0.35%, Australia's ASX 200 0.03% and China's Shanghai -0.99%.

- The U.S. dollar was broadly firm, with its index hitting a one-year high of 82.613. Against the yen, the dollar stepped back slightly below to 104 yen level, but still not far off its seven-month peak of 104.49 yen hit on Monday.

- The euro also touched a 19-month low against the Swiss franc. The pair last stood at 1.2077 after touching a low of 1.2071, level not seen from January 2013.

- Citi on EUR/USD: CitiFX Technicals cut today all of its long USD positions trades by exiting a short EUR/USD position at 1.3195 booking a 536-pip profit (+3.92%). "While we continue to believe strongly in the bullish USD trade overall there are technical/historic dynamics that encourage us to “move to the sidelines” at this point," Citi argues. "EURUSD is oversold on both the daily and weekly charts (Most oversold on weekly chart since Jan 2012 with some divergence on the daily chart). It would not surprise us to see EURUSD back on a 1.33 “handle” sometime this week," Citi projects.

- The markets still play the Draghi comments from last week. The ECB president delivered a ground-breaking speech at Jackson Hole, calling for government spending to do more of the heavy lifting of bringing idled workers back on the job while acknowledging that, his previous excuses aside, market prices show he is losing the battle against falling inflation. All of this is refreshing, and would be highly encouraging but for some pesky realities. Euro zone countries are not likely, any time soon, to engage in any meaningful stimulus through government spending.

- Speculation that the ECB could buy debt of euro zone countries drove down yields on bonds from Germany, France, Italy, Spain, Portugal and Ireland and others to all-time lows. German 10-year yields hit a record low of 0.926 percent.

- Germany's Ifo business climate index published on Monday showed business confidence sagged for the fourth straight month, create more pressure for ECB to act. The index fell to 106.3 from 108, undershooting a Reuters consensus forecast of 107.

- Scotland's pro-independence leader Alex Salmond won a final TV debate on Monday just over three weeks before a historic breakaway referendum, but it wasn't clear if his combative performance would help him catch up in the polls. In a bruising debate before the Sept. 18 referendum, Salmond relentlessly talked over and at Alistair Darling, the leader of the "Better Together" anti-independence movement, and it was sometimes hard to hear what was being said.

- The New Zealand dollar dropped to a six-month low of $0.8311, hit by New Zealand's surprisingly large trade deficit.

- The Conference Board Leading Economic Index ® (LEI) for China increased sharply to 1.3 percent in July. The index stands at 297.7 (2004 = 100), following a 1.3 percent increase in June and a 0.7 percent increase in May. Five of the six components contributed positively to the index in July.

- Watch today: US durable goods & US house prices.

Have a nice Day!