By FX Empire.com
The Australian dollar has extended its downside movement versus its major counterpart after the Australian economy reported that its consumer price index eased in October, supporting the RBA is to keep the rates unchanged in the upcoming period as inflation pressures slow.
Aussie lost some gains against the US dollar on concern European leaders may not be able to construct a plan to resolve the region’s debt crisis when they meet in Brussels on Wednesday.
On the other hand, the Aussie is finding support against the its US counterpart as the nation showed that its cheerful phase has started after the services industry index rebounded for the first time in more than four months led by growth in finance and communications, supporting demand for Australian dollar.
On Thursday the market will open to the final announcement from the EU leaders and what the euro area will do to contain the crisis. This will be the main impact and focus for trading and actually for the coming period, to assess if the measures are strong enough or not.
Also at 12:30 GMT the U.S. economy will release the annualized Gross Domestic Product for the third quarter, where the advanced reading is expected to show a growth of 2.3% from the previous 1.3%.
U.S. Personal Consumption is expected to show a rise of 1.9% from the prior 0.7%, while Core PCE is expected to come at 2.3% in line with the previous quarter.
On Thursday at 12:30 GMT, the U.S. economy will issue its weekly initial claims numbers, where the number of people filing for first-time claims for state unemployment insurance increased 403 thousand last week.
The U.S. Pending Home Sales for September is expected to come at 0.1% from -1.2%, while the annual reading had a prior reading of 13.1%.
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