Aussie Holds Firm Near Three-Month High, US Dollar Weakens
AUD/USD held steady above 0.6650 during Friday's Asian session, approaching a nearly three-month high touched last Wednesday. The pair regained buying power after a brief correction following the release of mixed Australian jobs data. Overall, the Aussie is on track for a third consecutive week of gains, supported by a combination of fundamental factors that remain pro-risk.
Selling pressure on the US dollar (USD) persisted as expectations for the Fed grew increasingly dovish. Although the Fed officially projects only one more interest rate cut in 2026, market participants are predicting two additional cuts next year. Comments by Fed Chair Jerome Powell about the risk of a significant downturn in the labor market and the Fed's reluctance to suppress job creation also weakened the greenback's appeal and supported riskier currencies like the Australian dollar.
On the other hand, the Aussie was also supported by the hawkish stance of the Reserve Bank of Australia (RBA). RBA Governor Michele Bullock, following the decision to hold interest rates at the start of the week, emphasized that the board is still discussing the possibility of a rate hike if needed and believes additional cuts are unnecessary at this time. This hawkish tone was enough to offset the impact of Australia's tepid employment data and act as a tailwind for the AUD/USD's recent gains.
Looking ahead, there are no major US economic data releases on Friday, so USD movements will be largely influenced by comments from Fed officials and global risk sentiment. If Fed officials remain dovish and global stock markets remain risk-on, there is still room for the Aussie to strengthen against the USD. However, traders should remain wary of profit-taking ahead of the weekend after a lengthy rally. (asd)
Source: Newsmaker.id
