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

Main headlines:

Pressure mounts on ECB to tame bond yields - Reuters

Fed Watching ECB Just as Closely as Markets Are - CNBC

Manufacturing in US Shrank in August for Third Month - Bloomberg

Risk Increases of Prolonged World Slowdown, BOJ's Miyao Says - Bloomberg

Youth jobless rate to rise, says ILO - FT

Emerging Market Stocks Decline on China, Europe Concerns - Bloomberg

Americas wrap-up:

Jobs growth seen lacklustre in August, Fed action eyed - Reuters

Autos Lead US Recovery as August Sales Seen Aiding Obama Re-Election Bid - Bloomberg

Record 46 Million Americans Are on Food Stamps - CNBC

US Slips Down the Ranks of Global Competitiveness - CNBC

Michelle Obama Makes Personal Appeal in Convention Speech - Bloomberg

Apple Announces Sept. 12 Event, New IPhone Anticipated - Bloomberg

US accuses BP of gross negligence in gulf - FT

Brazil Swap Rates Rise on Industrial Production; Real Declines - Bloomberg

Colombia Sets Agenda for Peace Talks - WSJ

Asia-Pacific summary:

Asian Stocks Fall 5th Day as US Manufacturing Contracts - Bloomberg

Australia's GDP Growth Slows as Currency Falls on Rate-Cut Bets - Bloomberg

Japan ruling party manifesto urges BOJ to buy foreign bonds - Reuters

Singapore Acquisitive REITs Yield World's Best Returns - Bloomberg

Samsung Abuses Workers At Its China Plants, Labour Group Says - Bloomberg

European news:

Euro Declines Before ECB Meeting, Retail Sales, Services Data - Bloomberg

Greece Should Exit Euro: Prominent German Economist - CNBC

Lufthansa Faces New Strike - WSJ

Spain's New Maths: More Students, Fewer Teachers - WSJ

UK's Cameron Shuffles Cabinet - WSJ

Swiss Economy Shows Weakness - WSJ

Slowing Polish Economy May Force Tusk to Ease Budget Cuts - Bloomberg

Hungary Surprise Rate Cut Sends Yield to Year-Low - Bloomberg

Russian Inflation Quickens to 5.9% in August, Below Forecast - Bloomberg

Brussels opens probe into Gazprom - FT

Forex brokers back HFT clampdown - FT

FOREX action

EUR: The euro continues to pare recent gains amid lacklustre economic indicators. All eyes are turning to tomorrow's ECB monthly meeting where Mario Draghi could lay the ground for sovereign debt market intervention. EUR-USD holds above 1.2500 after breaching 1.2600 and EUR-JPY is trading above 98.00.

GBP: The sterling crosses ease along with the euro trades. Cable trades close to 1.5860 while GBP-JPY is in the vicinity of 124.40. EUR-GBP slides towards the 0.7900 support area after a recent spike towards 0.7960.

CHF: The Swiss franc consolidates after recent gains. After getting close to the 0.9500 floor, USD-CHF rises close to 0.9585. Meanwhile, EUR-CHF is in its familiar trading range close to 1.2010 that the SNB is still determined to defend despite strong reserve consumption.

Nordics: The kroner and the krona show a mixed bag of trading patterns. Both the NOK and the SEK are steady versus the euro and slip against the green-back.

USD & JPY: The US dollar and the Japanese yen firm a bit in a risk-off, risk-on context. Today we will pay close attention to Q2 productivity figures. USD-JPY trades close to 78.40.

CAD, AUD & NZD: The Aussie dollar keeps trailing behind its peers, the kiwi and the loonie. A very weak services PMI reading in Australia adds wood to the fire of Aussie dollar bashing. In intra-day trading, the AUD-USD has broken the important support area found at 1.0200. China's composite PMI shows that Asia's biggest economy has entered recessionary levels.

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