The AUD/USD pair trades inside Thursday’s trading range slightly above the two-year low of 0.6200 near 0.6230. The Aussie pair exhibits volatility contraction, with investors focusing on the United States (US) Personal Consumption Expenditure Price Index (PCE) data for November, which will be published at 13:30 GMT.The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, ticks lower after posting a fresh two-year high at 108.50.Economists estimate the annual US core PCE inflation, a Federal Reserve’s (Fed) preferred inflation measure, to have accelerated to 2.9% from 2.8% in October. Month-on-month, the underlying inflation is estimated to have grown by 0.2%, slower than the former release of 0.3%.The inflation data will influence market expectations for the Federal Reserve’s (Fed) likely interest rate action in the January meeting. According to the CME FedWatch tool, traders are confident that the central bank will leave interest rates at their current levels of 4.25%-4.50%.Meanwhile, the Australian Dollar (AUD) will be influenced by the Reserve Bank of Australia (RBA) minutes for the monetary policy meeting that took place on December 10, which will be released on Tuesday. The RBA left its Official Cash Rate (OCR) steady at 4.35%, a level the central bank has been maintaining since November 2023.RBA Governor Michele Bullock didn’t guide a specific interest rate cut path and committed to be data-dependent but was confident that wages and demand are slowing.More By This Author:EUR/USD Trades With Caution As Fed’s Hawkish Cut Boosts US Dollar’s Appeal EUR/GBP Rises Sharply To Near 0.8250 After BoE Holds Rates Steady At 4.75% GBP/JPY Soars To Near 198.80 As BoJ Holds Rates Steady, BoE Policy Eyed
