European session:

The euro weakened against the dollar after a European report showed the region’s manufacturing and services industries shrank in April more than economists predicted.

The common currency extended its daily losing streak to the longest since September as France and Greece prepared to hold elections this weekend, creating uncertainty about the two nations’ commitment to austerity measures. The dollar strengthened against most of its major counterparts before a

France and Greece will hold elections on May 6, with French voters casting ballots in the final round of the country’s presidential race and Greeks set to decide on a new parliament.

Francois Hollande, the Socialist challenger for the French presidency who is leading incumbent Nicolas Sarkozy in opinion polls, has called for a re-negotiation of the budget pact crafted by European leaders in March, saying it needs to place more emphasis on growth. He has rejected Sarkozy’s plan to increase sales tax to fund a cut in payroll charges.

In Greece, neither of two major political parties that have supported the nation’s international bailouts -- New Democracy and Socialist Pasok -- is likely to win an outright majority.

EUR/USD: the pair was limited $1,3120-$ 1,3160.

GBP/USD: the pair was limited $1,6160-$ 1,6190.

USD/JPY: the pair was limited Y80,10-Y80,30.

In Canada, the Ivey Purchasing Managers Index is due at 1400GMT. The, at 1425GMT, San Francisco Fed President John Williams speaks to the California Bankers Association 121st Annual Convention.