By FX Empire.com
The pair advanced on Wednesday trading as haven demand amid the uncertainty in the euro area boosted the dollar.
Still, the main focus is on the latest developments from the euro zone debt-laden economies, where the main concentration meanwhile is on the imminent political change in Greece and Italy.
Italian bond yield rose to record high and Credit Default Swaps climbed also, noting that the baled-out Ireland is having a similar rise in bond yields.
Prime Minister Silvio Berlusconi offered to step down after the approval of the austerity measures needed to cut the euro area’s second-largest budget shortfall, where he failed to gain strong majority in the budget vote as some of his allies supported opposition which put the voting on the austerity measures at risk.
On the other hand, Greek Prime Minister George Papandreou agreed to step down to make a national unity government to continue the progress with the EU and IMF.
Greek Prime Minister George Papandreou agreed to step down to make a national unity government that has to accept the EU/IMF aid program to receive the next tranche of last year’s bailout this month to avoid default.
On the other hand, investors are cautious to buy the franc where there is mounting expectations the SNB would intervene again to curb the franc, especially as the recent economic reports and earnings by Swiss companies showed the negative impact of the franc’s appreciation.
SNB Vice President Thomas Jordan said on Tuesday the franc remains overvalued and the bank is ready to intervene at any time if needed.
On Thursday, as of 13:30 GMT, the U.S economy will release trade balance which is expected to show a widened deficit of $46.0 billion in Sep. from $45.6 billion deficit a month earlier. At the same time, initial jobless claims for the week ended Nov. 4 and continuing claims for the week ended Oct. 28 will be available. At 19:00 GMT, the monthly budget statement for Oct. is predicted to show a deficit of $110.5 billions.
The data is predicted to have significant impact on the pair, yet the main focus will remain on the latest developments from Greece and Italy.
Originally posted here
