AUD Strengthens Against Greenback as Employment Data Beats Forecasts

Thursday brought solid gains for the Australian Dollar as the latest employment figures from Down Under exceeded market predictions. The AUD/USD pair rallied following the release of stronger-than-expected labor market metrics, with the currency pair pushing toward key resistance levels.

Impressive Employment Figures Drive AUD Higher

Australia’s jobless rate dropped to 4.3% in October, down from 4.5% the previous month and beating consensus expectations of 4.4%. The headline employment change stat painted an even rosier picture—job additions hit 42.2K against forecasts of just 20K, marking a significant outperformance.

The employment composition reveals an interesting dynamic: full-time positions expanded by 55.3K, while part-time roles contracted by 13.1K. This shift toward permanent employment typically supports consumer confidence and economic stability. The participation rate held steady at 67%, suggesting a stable workforce engagement level.

RBA Deputy Governor Andrew Hauser added nuance to the positive jobs narrative on Wednesday, noting that monetary policy “remains restrictive” while acknowledging internal committee debate on this assessment. He hinted that if restrictive settings ease, the central bank would face “significant implications for future decisions”—language that suggests caution against premature rate cuts.

US Dollar Extends Rally on Government Resolution Optimism

The US Dollar Index (DXY) climbed for a second consecutive session, hovering near the 99.60 mark as investors grew confident the government shutdown standoff would resolve this week. The House of Representatives approved a funding package 222-209, paving the way for presidential signature and ending the longest shutdown in US history.

President Trump signaled his optimism about inflation moderating to 1.5% “pretty soon,” a level unseen since early 2021. Such disinflation would be welcome news after years of elevated price pressures. Meanwhile, private sector employment data proved weaker than expected, with ADP reporting average weekly job losses of 11,250 in the four weeks through October 25—a reading that increases odds of Federal Reserve policy accommodation down the line.

Global Cross-Currents: China’s Economic Signals

China’s Ministry of Commerce announced a temporary suspension of its ban on exporting certain dual-use materials (gallium, germanium, antimony, and advanced compounds) to the US through November 27, 2026. Given Australia’s deep trade ties with China, economic developments in the region carry direct implications for AUD sentiment.

China’s October CPI rose 0.2% year-on-year, rebounding from September’s 0.3% decline and beating the 0% consensus. The Producer Price Index fell 2.1% annually, an improvement versus the -2.2% market forecast. These mixed signals suggest deflationary pressures persist despite some consumer-level price stability.

On the local front, Australia’s Westpac Consumer Confidence index jumped 12.8% in November to reach 103.8—the first time above 100 since February 2022. This marked the strongest non-pandemic reading in seven years, driven by brightening economic conditions and easing external headwinds.

Technical Picture: AUD/USD Eyes Rectangle Breakout

The AUD/USD pair trades near 0.6560 on the daily chart, consolidating within a rectangular formation that reflects near-term sideways price action. The currency pair maintains its position above the nine-day Exponential Moving Average (EMA), indicating short-term bullish underpinning.

Buyers targeting the rectangle’s upper boundary around 0.6630 could establish a bullish breakout. A decisive move above that level would clear the path toward the 13-month peak of 0.6707, set on September 17. On the flip side, support anchors around the 50-day EMA at 0.6537 and the nine-day EMA at 0.6531. Breaking below these layers would invite sellers to test the rectangle’s lower boundary near 0.6470, with the five-month low of 0.6414 (August 21) emerging as a secondary floor.

Compared to other major pairs, the Australian Dollar showed relative strength, gaining 0.40% against the New Zealand Dollar while the US Dollar edged up just 0.02% against the Euro. This differential reflects the appeal of AUD strength tied to hawkish RBA rhetoric paired with solid domestic labor metrics versus a US Dollar in consolidation mode ahead of policy clarity.