Australian Dollar Edges Lower Near 0.6865 Amid Robust US Jobs Data and RBA Rate Hike

Australian Dollar Reacts to US Employment Data and RBA Policy

As of early Asian trading on Monday, the AUD/USD currency pair experienced mild losses, hovering near the 0.6865 support level. This movement followed the release of stronger-than-expected US employment figures on Friday, November 8, 2026, which bolstered the US dollar against the Australian dollar. According to data from the US Bureau of Labor Statistics, Nonfarm Payrolls increased by 165,000 in October, significantly surpassing market expectations of 65,000 and improving on the revised September figure of 60,000. The US unemployment rate also declined slightly to 4.1% from 4.2% in September.

These robust labor market indicators have influenced market expectations for US monetary policy. The CME FedWatch tool indicated a 79.6% probability of a 25 basis point rate hike at the Federal Reserve’s December meeting, though it suggested only one additional increase thereafter. Fed officials, including Daly, have emphasized the persistence of inflation and the need for further policy tightening, citing the strong labor market as providing room for additional rate adjustments.

Meanwhile, the Reserve Bank of Australia (RBA) raised its Official Cash Rate by 25 basis points to 4.85%, marking the highest level since 2008. The RBA’s monetary policy statement highlighted ongoing elevated inflation, expected to persist through much of 2027. Australian Treasurer Jim Chalmers acknowledged the government’s ongoing efforts to address inflationary pressures.

Technical and Market Context

Strategists at Societe Generale noted that AUD/USD traded within a range of 0.6862 to 0.6954 overnight, slipping below the 0.69 mark for the first time since early July. The pair is on track for its lowest weekly close since January, with key technical levels identified at support 0.6865 and resistance 0.7080. The downward pressure on the Australian dollar has been compounded by concerns over the RBA’s ability to manage inflation effectively, as highlighted by recent commentary from RBA Governor Philip Lowe’s successor, Michele Bullock, and market participants.

Broader foreign exchange market dynamics also influenced the AUD, with spillover effects from equity market selloffs impacting other currencies such as the Swedish krona (SEK) and New Zealand dollar (NZD) within the G10 group. Emerging market currencies like the South Korean won (KRW) and Mexican peso (MXN) have also been among the weaker performers recently.

FXVNPro Market Perspective

From a market transmission standpoint, the Australian dollar’s reaction to US labor data and RBA policy reflects the interplay between relative monetary policy expectations and risk sentiment. Strong US employment data tends to support the US dollar by reinforcing expectations of sustained Federal Reserve tightening, which can weigh on commodity-linked currencies like the AUD. Conversely, the RBA’s rate hike signals a commitment to combating inflation but may be perceived as insufficient if inflation remains elevated, potentially limiting AUD upside.

Market participants should consider that the AUD/USD pair’s technical support at 0.6865 and resistance near 0.7080 represent key levels where price action may consolidate or reverse, depending on evolving economic data and central bank communications. Additionally, upcoming Chinese Consumer Price Index (CPI) data could influence risk appetite and commodity demand, indirectly affecting the Australian dollar.

Trading Scenarios

• If US employment data continue to surprise on the upside and Fed officials maintain a hawkish stance emphasizing further tightening, then the US dollar may strengthen further, potentially pushing AUD/USD below the 0.6865 support level.
• If Chinese inflation data come in softer than expected, alleviating concerns about demand and supporting risk sentiment, then the Australian dollar could find support and attempt to reclaim resistance levels near 0.7080.

What Traders Should Watch

• Upcoming Chinese CPI inflation figures, which may impact risk sentiment and commodity-linked currencies.
• Federal Reserve communications and any shifts in policy guidance, especially regarding the pace and extent of rate hikes.
• Australian inflation data and RBA commentary for indications of the central bank’s future policy trajectory.
• Technical price action around the 0.6865 support and 0.7080 resistance levels, which may signal potential trend continuation or reversal.

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