Asian session: Japan’s currency slid

01:00 China Non-Manufacturing PMI August 54.1 53.9

01:30 Australia Retail sales (MoM) July 0.0% +0.4% +0.1%

01:30 Australia Retail Sales Y/Y July +1.1% +1.9%

01:30 Australia Current Account, bln Quarter II -8.5 -8.3 -9.4

01:30 Japan Labor Cash Earnings, YoY July +0.1% +0.8% +0.4%

04:30 Australia Announcement of the RBA decision on the discount rate 2.50% 2.50% 2.50%

04:30 Australia RBA Rate Statement

Japan’s currency slid versus all its 16 major peers after data showed the nation’s monetary base expanded in August by the most in 40 years as Bank of Japan policy makers prepare to meet this week. The BOJ said today the nation’s monetary base expanded 42 percent in August from a year earlier, the biggest gain since 1973, to 177 trillion yen ($1.78 trillion). The central bank buys more than 7 trillion yen of Japanese government bonds every month to increase the gauge of the supply of money to 270 trillion yen by the end of 2014 and stoke 2 percent inflation.

The dollar touched a six-week high against a basket of its main counterparts ahead of a U.S. report that may signal growth in factory output, fanning speculation the Federal Reserve will start to taper its quantitative-easing program as early as this month. The Institute for Supply Management’s U.S. factory index is estimated at 54 in August, compared with a two-year high of 55.4 in July, economists forecast before the release of the data today.

The European Union’s statistics office will probably confirm tomorrow that gross domestic product in the 17-nation currency bloc expanded 0.3 percent in the April-June period, ending the longest recession on record, according to the median estimate of economists surveyed by Bloomberg News.

EUR / USD: during the Asian session the pair fell to $ 1.3180

GBP / USD: during the Asian session, the pair rose to $ 1.5560

USD / JPY: during the Asian session the pair rose to Y99.70

There is only limited UK data set for release, with the August  CIPS/Markit Construction PMI numbers due to be published at 0830 GMT.  Economists are looking for a monthly print of 56.9, down modestly from July's 57.0. After the excitement of Monday's manufacturing PMI data, the European calendar slows somewhat Tuesday. However, US markets return from the  Labor Day holiday, with their PMI data due later in the day. The Euro area calendar gets underway from 0700GMT, with the release of the Spanish August unemployment numbers due. Analysts are looking for a modest uptick of 7,500 in the overall unemployment numbers. French August car registration data is expected at 0700GMT. German car registrations are also expected at some time in the morning session. Switzerland's second quarter GDP data will be released at 0745GMT. Expectations are for an increase of 0.3% q/q, with an annualised increase of 1.7%. At 0900GMT, EMU July PPI numbers will cross the wires. Expectations are for an increase of 0.1% quarterly and annually.