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AUD/USD breaks out as a weaker dollar lifts risk appetite
Australia’s July jobs data are expected to show about 12k employment growth, amid ongoing debate over whether the RBA is finished hiking.
AUD/USD extended its rally after breaking above a near term channel ceiling, with Action Forex attributing the move to external tailwinds including a weaker US dollar and a rebound in regional risk appetite.
Markets have been scaling back the Fed path toward only “one and a bit” additional hikes through mid 2027, while equity strength abroad has supported sentiment, including the KOSPI more than 30% above its July trough and the Nikkei about 14% higher.
Looking ahead, the July employment report arrives with expectations for employment growth of around 12k jobs, down sharply from 76.3k in June, and an unemployment rate holding at 4.4%, according to the article.
The data could test a central disagreement on the Reserve Bank of Australia, where major banks have base cases of no further 2026 hikes, but the RBA’s own guidance remains hawkish, keeping alive the possibility of additional rate action. The article also notes the rates market pricing implies roughly a 50% chance of another hike by year end.
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