The U.S. dollar was seen easing back after posting strong gains in the weeks before.

The sentiment in the U.S. dollar soured a bit as renewed trade tensions arose.

The U.S. administration went ahead with its steel and aluminum tariffs on its trading partners including the Eurozone, Canada and Mexico.

The EU responded by filing a lawsuit against the U.S. at the World Trade Organization.

Sentiment in the Eurozone was also seen improving with some stability seen coming from the Italian political uncertainty that rattled the markets just the week before.

However, trading in the euro currency remained subdued ahead of the ECB’s monetary policy meeting this week.

RBA holds rates steady. Australia GDP advances

The Reserve Bank of Australia held its monetary policy meeting last week as the central bank opted to keep interest rates unchanged as widely expected. Interest rates in Australia were seen at record lows of 1.50%.

The central bank judged that holding monetary policy unchanged would be consistent with sustaining growth in the economy noting that low interest rates were supporting growth in the economy.

The RBA’s decision came just a day before the Australia Bureau of Statistics released the quarterly GDP numbers.

According to official data, Australian GDP advanced 1.0% in the three months ending March 2018.

This was higher than the estimates of a 0.9% increase and the previous quarter’s GDP data was also revised higher to show a 0.5% increase.

On a yearly basis, Australian GDP was seen rising 3.1% which beat the median estimates of a 2.8% increase.

Compared to the three months before, GDP increased 2.4%.

The biggest gains came from export of goods and services which contributed 0.5 percentage points to the GDP.

Mining industry also added 2.9% during the quarter while private non-financial firms profits contributed 6.0% to the overall GDP.

“Growth in exports accounted for half the growth in GDP, and reflected strength in exports of mining commodities,”

ABS Chief Economist Bruce Hockman said.

UK PMI: A rebound in business activity

The monthly PMI numbers for the month of May showed that business activity was showing signs of a turnaround after posting weak numbers for the first four months of the year.

The somewhat better than expected PMI readings across the manufacturing, services and construction sectors, confidence is set to return that the UK’s economy might be turning the corner.

The UK’s manufacturing PMI data showed a pick up in activity as the index increased to 54.4 in the month of May.

This was higher than the estimates of 53.5 and a modest increase from April’s 53.9.

Meanwhile, the construction PMI remained flat during the month with a headline print of 52.5 which was the same reading in April.

The services PMI showed a strong rebound to 54.0.

Despite the somewhat better than expected PMI numbers, the data showed that employment was bleak during the month.

This was attributed to lack of skilled staff. At the same time, price pressures were seen to have increased across all the sectors and suggests that consumer prices could also start to rise in the UK.

There were also rising costs due to higher fuel prices during the month.

The data comes ahead of this week’s inflation and jobs report.

The Bank of England is expected to raise interest rates in August and preliminary forecasts show that the UK’s inflation rate might have ticked higher in the month of May, while at the same time estimates show that the pace of wage growth might have decreased.

U.S. non-manufacturing activity surges in May

Latest economic data from the U.S. saw the release of the Institute of Supply Management (ISM’s) non-manufacturing PMI report coming out.

Data showed that activity in the services sector increased strongly in the month of May as the non-manufacturing index rose to 58.6 in May.

This was higher than the forecasts that pointed to an increase to 57.5 and higher compared to April’s reading of 56.8.

Anthony Nieves, the chairman of ISM said that the majority of the respondents in the survey were optimistic about business conditions and the overall state of the economy.

This comes as the new business orders index increased to 60.5 during the month while the business activity index rose to 61.3 in May compared to April’s 59.1.

The non-manufacturing report also showed that prices index rose to 64.3 in May.

This was a strong increase from April’s print of 61.8.

The data suggested that prices continued to rise for the 27th consecutive month and indicated that consumer inflation might have likely increase in the month of May.

The Fed’s PCE price index was seen close to 2.0% in April.