This is a review of the elements likely to affect foreign exchange (Forex) trading in Europe:

Main headlines:

Bernanke may hint at stimulus without boxing Fed in - Reuters
Judgement Days Arrive In Euro Crisis - WSJ
India Growth Beats Estimates After Rate Cut To Aid Spending - Bloomberg
Deflation Deepens as Japan Contraction Risk Rises on Weak Output - Bloomberg
Food Supply Adequate to Forestall Unrest, World Bank Says - Bloomberg

Americas wrap-up:

US consumer spending posts biggest rise in five months - Reuters
Record farm export sales seen despite drought: USDA - Reuters
Mitt Romney Accepts Republican Presidential Nomination - Bloomberg
Romney: 'What America Needs Is Jobs, Lots of Jobs' - CNBC
Brazil Swap Rates Rise on Signal Rate Cuts Near End; Real Strengthens - Bloomberg

Asia-Pacific summary:

Overdue loans prompt China banks warning - FT
Industrial Output Falls in Japan - WSJ
India Growth Beats Estimates After Interest-Rate Cut to Fight Europe Risk - Bloomberg
South Korea's Industrial Production Slides as Europe Crisis Hits Exports - Bloomberg
Hong Kong to Boost Home Supply, Favor Locals as Prices Surge to Record - Bloomberg
Chinese tourists boost Taiwan economy - FT
Samsung triumphs over Apple in Japan patent case - Reuters
Nomura's Nagai Said to Plan $1 Billion More in Expense Cuts - Bloomberg
Glencore Mine Deaths Give Xstrata Holders Extra Ratio to Ponder - Bloomberg
Aussie Dollar Near Five-Week Low on China Growth Concern - Bloomberg

European news:

Brussels pushes for wide ECB powers - FT
Economic uncertainty growing massively says ECB's Nowotny - Reuters
Crisis sharpens divisions over EU budget - FT
Merkel faces EU clash over China - FT
Wen Tells Merkel Spain, Italy, Greece Need More Reforms - Bloomberg
German Retail Sales Unexpectedly Fell in July as Economy Weakens - Bloomberg
Italians Squeezed by $9.50-a-Gallon Gas Face Costly Drive Home - Bloomberg

FOREX action

EUR: The main euro crosses pare their recent gains. Market participants are waiting for next week's ECB monthly meeting where ECB President Mario Draghi could give a hint of the bank's bond market intervention plans. The speculation about the Bundesbank president stepping down seems to be a tactical threat by Merkel to reduce the scope of peripheral bond purchases. EUR-USD eases towards 1.2500 and EUR-JPY fails below 98.50.

GBP: The sterling crosses move in synch with the euro trades. Today's upbeat economic indicators in the UK are not having a positive impact. Cable is below 1.5800, while GBP-JPY trades close to 123.82. EUR-GBP moves sideways pivoting in the 0.7930 area.

CHF: As per the rest of the European cross-rates, the Swiss franc slips versus the dollar. USD-CHF is back close to 0.9600. Meanwhile, EUR-CHF is in its familiar trading range close to 1.2010.

Nordics: The NOK and the SEK firm a tad versus the euro and the dollar. Norges Bank deputy governor Qvigstad said yesterday that Norway won't tolerate persistent kroner gains.

USD & JPY: The US dollar steadies before the long-awaited Ben Bernanke's speech at the Federal Reserve Symposium in Jackson Hole, Wyoming. Today, all the attention will be focused on Bernanke as well as consumer confidence and factory orders figures in the US. USD-JPY trades close to 78.45.

CAD, AUD & NZD: The Aussie dollar recovers a bit after reaching a five-week low against the US dollar. China's mounting growth concerns put in doubt Australia's economic resilience. The mining boom could be over according to some sources. Australia's private sector credit as well as recent capital expenditure figures point to a slowdown in activity.

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