The USD paused in its relentless recovery today, enabling other markets to catch their breath. Commodities like crude oil bounced back a bit along with gold and silver, supporting rebounds in resource currencies including AUD, NZD, CAD and the precious metal sensitive ZAR. US economic news was mixed today with the Empire Manufacturing survey coming in way above expectations but industrial production falling short. US traders remain focused, however on Wednesday’s FOMC decision, member projections and press conference. Regardless of when or how aggressively the FOMC intends to normalize monetary policy and raise interest rates, it is likely to become more hawkish in the months ahead. Stock traders appear to be finally realizing the liquidity party may be winding down sooner than thought. While the Dow managed to eke out a small gain, the NASDAQ 100 and Russell 2000 spent most of the day down 1% or more. This indicates that traders are starting to take profits and get out of momentum stocks and small caps indicating that the breadth of the rally is shrinking a sign of exhaustion and the increasing potential for a significant correction. A defensive shift in sentiment may also explain the rebound in precious metals today. AUD and the S&P/ASX may be active between the continued fallout from last weekend’s soft China data which has also knocked back the Hang Seng, China A50 and CNH this week. Today’s RBA minutes may attract some attention from traders, although the central bank appears to be firmly in neutral and recent declines may have reduced the need to talk down the dollar. Tomorrow morning, UK inflation looks likely to be ignored and totally overshadowed by anticipation of Thursday’s Scottish Referendum which could force the hand of the Bank of England more than another economic number. Likewise the German ZEW survey may not have much of an impact with ECB stimulus starting on Thursday. Economic News Significant announcements released overnight include: US Empire manufacturing street 15.9 US industrial production (0.1%) vs street 0.3% US manufacturing production (0.4%) vs street 0.2% Canada existing home sales 1.8% vs previous 0.8% Upcoming significant announcements include: 11:30 am AEST Australia RBA minutes 9:30 am BST UK consumer prices street 1.5% 9:30 am BST UK retail prices street 2.4% 9:30 am BST UK producer input prices street (6.8%) 9:30 am BST UK producer output prices street (0.2%) 9:30 am BST UK ONS house prices previous 10.2% 10:00 am BST Germany ZEW current street 40.0 10:00 am BST Germany ZEW expectations street 5.0 10:00 am BST Eurozone ZEW expectations previous 23.7 8:30 am EDT US producer prices street 1.8% 8:30 am EDT Canada manufacturing sales street 1.1%