China has relatively ample room for monetary policy, the deputy governor of the country's central bank said on Monday in remarks about follow-up policy measures to prop up the shaky recovery of the world's second-biggest economy.

Chinese policymakers signalled a renewed sense of urgency on Monday for steps to shore up the flagging economy, saying this quarter was a critical time for policy action as evidence points to a further loss of economic momentum.

The euro zone is almost certainly entering a recession, with surveys on Monday showing a deepening cost of living crisis and a gloomy outlook that is keeping consumers wary of spending.

China's central bank said on Monday it will cut the amount of foreign exchange reserves that financial institutions must hold, a move seen as aimed at slowing the yuan's recent depreciation.

Malaysia's central bank will deliver a third consecutive 25 basis point interest rate hike on Thursday and a fourth in November to quell growing inflationary pressures but will opt to move slowly despite a hawkish U.S. Federal Reserve, a Reuters poll found.

The dollar took a breather on Tuesday after a sweeping rally, easing slightly from milestone highs on the euro, yen and sterling, but not too far as recession stalk Europe and U.S. interest rates are poised for sharp rises.