U.S. economic data on Friday printed stronger than most investors had anticipated. Personal income and personal spending each rose 0.6% in February relative to the previous month, which were both twice as strong as expectations, and the Chicago PMI surged from 49.3 in February to 61.7 in March, the highest reading in nearly two years. Does this mean the slowdown in growth that has been in place over the past few quarters is behind us? Probably not, but the stronger-than-expected data are welcome news at a time when many market participants are focused on the troubles in the subprime mortgage market, and they serve as a timely reminder of the general resilience of the U.S. economy.

Despite the stronger-than-expected data on Friday, the dollar is generally weaker versus most major currencies this morning. The dollar depreciated on Friday when the Commerce Department announced that it was raising tariffs on coated paper products from China. The decision raises the possibility the adminstration will seek other policies, including measures to weaken the dollar, to address the nation's trade deficit. Some individual currencies were also boosted by country-specific news. For example, the Australian dollar is closing in on a 10-year high following the release last night of February's retail spending data that were much stronger than expected. Rising expectations of a rate hike this week by the Bank of England is helping to boost sterling this morning.

Attention now turns to the ISM index of manufacturing activity, which will be released this morning at 10:00 EDT. The market consensus forecast anticipates that the index declined a bit in March, although the stronger-than-expected Chicago PMI on Friday suggests some upside risk to the ISM index. Stronger-than-expected data should give the dollar some support, but a disappointing outturn should weigh on the greenback.