A lackluster night in FX markets as EUR/USD trades either side of 1.2000 figure. The Euro-zone calendar is extremely quiet as the only eco news is from Italy, the region' s third largest economy.  The market is instead likely to focus on the slew of US data including the important CPI figures and the Advanced Retail Sales which are expected to return to post a 0.7% month over month gain.    

The vacillation in the price flow reflects the overall uncertainty of most market participants over the direction of the US economy. While dollar bulls contend that growth and employment will continue at a healthy pace in the fourth  quarter, dollar bears point to signs of slowdown in the key housing market as a precursor to further weakness in the months ahead.  With mortgage rates now above 6% the parabolic rise in housing asset values has now stalled and even if values do not decline, the mere lack of appreciation in equity is likely to dampen consumer spending. Today's Retail Sales figures may go a long way to settling this debate for the time being.

Boris Schlossberg is a Senior Currency Strategist at FXCM.