(RTTNews) - The dollar remained stuck in the mud on Monday, near record lows versus the Swiss franc an yen, despite a deal to raise the U.S. debt ceiling.
After much political haggling, Democrats and Republicans are expected to approve a plan that cuts trillions in the spending in exchange for lifting the nation's borrowing limit.
Still, with economic headwinds blowing strong around the U.S. and Europe, the safe haven Swiss franc and yen have become attractive alternatives to the dollar and euro.
The dollar was within a hair of Friday's record low CHF 0.7952 versus the dollar, and slid to Y77 versus the yen, giving back its gains from last night.
A move below Y76.30 will take the dollar to its lowest ever versus the yen.
The buck also weakened against the euro, slipping to $1.4440 from $1.4350.
Eurozone manufacturing recovery lost further momentum and moved closer to stagnation in July, survey results from Markit Economics revealed Monday.
The final Purchasing Managers' Index (PMI) fell to 50.4 from 52 in June, reaching its weakest level since the recovery began in October 2009.
The euro area unemployment rate remained unchanged at 9.9 percent in June, data from Eurostat showed Monday. The rate came in line with economists' expectations. The jobless rate was 10.2 percent a year ago.
Early losses kept the dollar near $1.6420 against the sterling, after losing significant ground on Friday.
U.K.'s manufacturing sector contracted for the first time in two years in July, Markit Economics said Monday.
The Markit/Chartered Institute of Purchasing & Supply Purchasing Managers' Index (PMI) for the manufacturing sector fell to 49.1 in July from a revised reading of 51.4 in June.
China's manufacturing sector contracted for the first time in a year in July, as production continued to decline, final survey results from Markit Economics showed Monday. According to the survey, inflation remained muted despite accelerating from the previous month.
The HSBC manufacturing purchasing managers' index fell to 49.3 in July from 50.1 in June.
In the U.S., a trio of job market reports and the Institute for Supply Management's manufacturing report are among the closely watched reports of the unfolding week.
The Labor Department's non-farm payrolls report is due on Friday, while ADP is scheduled to release its private sector payroll report on Wednesday. Additionally, the Labor Department will release its regularly scheduled weekly jobless claims report on Thursday.
The Institute for Supply Management is set to release the results of its manufacturing survey at 10 am ET. The manufacturing index based on the survey is expected to dip to 54.3 in July from 55.3 in June.
