LONDON (AFX) - The dollar's general weakness continued in subdued midday trade despite a singular lack of leads, dealers said. The release of the German research institute, ZEW's economic expectations index for June later this afternoon may provide market activity with a much needed boost, they said. The June ZEW index is expected to rise to 69.0 points from 66.3 in May. "The ZEW could supply some interest but I don't see any big movements for the euro," Razia Khan , economist at Standard Chartered said. In the meantime, the major currencies still lack direction. Against this backdrop, there is continued talk that the dollar's strength is slowly coming to end, dealers said. US data so far has not been convincing. It will take steady rises in retail sales and industrial output to help the dollar regain lost ground, Khan at Standard Chartered said. Dollar-yen was at around the 125 mark, a level comfortable enough for Japanese authorities to keep intervention at bay. Sterling was little changed despite evidence today that the UK's manufacturing sector appears to have finally turned the corner alongside a narrowing trade deficit. Official figures showed manufacturing output rising 0.8 pct in May against expectations of a 0.6 pct increase. This was the fastest monthly rise since August 2001 and was partly due to an encouraging rise in exports. Meanwhile industrial output rose 1.1 pct against expectations of a 0.5 pct rise. Many believe the Bank of England will wait for additional evidence of recovery before raising interest rates but HSBC's John Butler expects a July rate hike. "April saw the first official sign of recovery in manufacturing output. In addition, revisions to industrial output and the trade data in the first few months of the year point to a probable upward revision to Q1 GDP. These together have increased the likelihood of a rate rise at the July meeting. We still believe the MPC will take that opportunity, barring any particularly weak retail sales number," he said.