Forex Today: Greenback takes a step back on Monday

The US Dollar eased on Monday, giving other currencies a chance to recover some much-needed ground as markets gear up for another US NFP jobs print due at the end of the week.

Here's what you need to know heading into Tuesday, January 7:

The US Dollar Index (DXY) eased lower, falling back below the 109.00 handle and shedding around two-thirds of one percent. Broad-market risk sentiment is back on the rise, pushing the safe haven USD lower across the board. US Nonfarm Payrolls (NFP) due on Friday will be the week's key reading, however US ISM Services Purchasing Managers Index(PMI) figures are due on Tuesday.

EUR/USD bidders found the buy button on Monday, bolstering Fiber back into the 1.4000- handle. Preliminary European Harmonized Index of Consumer Prices (HICP) inflation is due early in the European market session on Tuesday, and markets will be looking for a slight uptick in headline inflation figures. However, even a bump in near-term inflation numbers are unlikely to spark much fear or greed in traders, as underlying inflation pressures appear to continue to cool.

GBP/USD caught a similar ride at the outside of the new trading week, gaining seven-tenths of one percent and getting muscled back above the 1.2500 handle. UK economic data remains decidedly limited this week, and Cable will be getting pushed around by overall market sentiment in the Greenback more than anything else.

AUD/USD tried to spark a bullish recovery on Monday, but bidding efforts fizzled, dragging Aussie bids back below the 0.6300 handle after briefly tapping the major technical level. Australian Purchasing Managers Index (PMI) figures improved slightly over the weekend, but it still wasn't enough to firmly push the AUD off of its recent lows.