Recovery off Friday's low of $1.1270....>

EURO-DOLLAR: Recovery off Friday's low of $1.1270 extended through Monday's

dealing as rate touched a high of $1.1358 before it eased to $1.1344 ahead of

the close. Early Asia retested that pullback low before it further extended the

recovery to $1.1360 through the Tokyo fix. However, rate struggled to hold gains

and drifted back, extending the low to $1.1340 ahead of Europe with recovery

attempts so far seen fairly muted. Support seen at $1.1340, stronger into the NY

low of $1.1330. A break here to expose the area around $1.1300. Resistance

$1.1360/65 ahead of $1.1380/85. The USD seen on the defensive ahead of

Wednesday's FOMC announcement, most expecting a 25bp hike with main focus on Fed

Powell's press conference. Some expectation that Powell will emphasise rate path

to be data dependent. Senior US Govt officials, including Trump, have been vocal

about the recent Fed hikes, and prospect of further moves, and the effect on the

US economy/stock market.

* Germany IFO due at 0900GMT, expected to come a little softer than last.

* US Housing Starts at 1330GMT in focus into the afternoon.