AUD/USD steadies as focus shifts to PMIs, US Nonfarm Payrolls and CPI

AUD/USD remains supported as the US Dollar stays under pressure, keeping the pair on track for a third straight weekly gain.
Monetary policy divergence widens, as the RBA holds steady while the Fed cuts rates again.
Focus shifts to next week’s data, with Australian and US PMIs, US Nonfarm Payrolls, Retail Sales, and CPI in the spotlight.

Vishal Chaturvedi FXStreet

The Australian Dollar (AUD) holds firm against the US Dollar (USD) on Friday as traders look past this week’s Reserve Bank of Australia and Federal Reserve (Fed) monetary policy announcements and reassess the near-term interest-rate outlook.

At the time of writing, AUD/USD is trading around 0.6656, stabilising after a short-lived dip toward 0.6632.

The Reserve Bank of Australia (RBA) held its cash rate steady at 3.60%, marking a third consecutive pause while signalling a cautious, data-dependent stance amid lingering inflation risks. By contrast, the Federal Reserve delivered a 25 basis point (bps) rate cut, lowering the Federal Funds Rate to the 3.50%-3.75% range, its third cut this year, reinforcing expectations that US monetary policy has entered a gradual easing phase.

Markets are now increasingly pricing in a prolonged pause from the RBA, with expectations building that the next policy move could be a rate hike in 2026 if inflation remains sticky. On the US side, traders continue to expect two rate cuts next year, despite limited forward guidance from the Fed.

This policy divergence continues to underpin the Aussie, keeping AUD/USD on track for a third consecutive weekly gain.

Earlier in the day, Comments from Fed officials showed continued caution around the policy outlook. Chicago Fed President Austan Goolsbee and Kansas City Fed President Jeffrey Schmid both dissented against this week’s rate cut. Goolsbee said he preferred to wait for greater clarity, particularly on inflation, before easing further, noting that recent data point to stable economic growth and only a moderate cooling in the labour market.

Schmid said that not much had changed since the previous meeting and added that monetary policy remains only modestly, if at all, restrictive, noting that the economy is showing momentum and that inflation remains too high.

With the key policy events now out of the way, market attention is shifting toward next week’s incoming economic data. Traders will closely watch the preliminary S&P Global PMIs from both Australia and the United States on Tuesday for fresh signals on economic momentum.

In the US, the spotlight will be on the Nonfarm Payrolls (NFP) reports for October and November, alongside Retail Sales on Tuesday and the Consumer Price Index (CPI) on Thursday.

Economic Indicator

Nonfarm Payrolls

The Nonfarm Payrolls release presents the number of new jobs created in the US during the previous month in all non-agricultural businesses; it is released by the US Bureau of Labor Statistics (BLS). The monthly changes in payrolls can be extremely volatile. The number is also subject to strong reviews, which can also trigger volatility in the Forex board. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish, although previous months' reviews and the Unemployment Rate are as relevant as the headline figure. The market's reaction, therefore, depends on how the market assesses all the data contained in the BLS report as a whole.

Why it matters to traders?

America’s monthly jobs report is considered the most important economic indicator for forex traders. Released on the first Friday following the reported month, the change in the number of positions is closely correlated with the overall performance of the economy and is monitored by policymakers. Full employment is one of the Federal Reserve’s mandates and it considers developments in the labor market when setting its policies, thus impacting currencies. Despite several leading indicators shaping estimates, Nonfarm Payrolls tend to surprise markets and trigger substantial volatility. Actual figures beating the consensus tend to be USD bullish.

Author

Vishal Chaturvedi

FXStreet

I am a macro-focused research analyst with over four years of experience covering forex and commodities market. I enjoy breaking down complex economic trends and turning them into clear, actionable insights that help traders stay ahead of the curve.

GBP/USD keeps the firm tone above 1.3600

GBP/USD clings to its daily gains, although it gives back some of them and recedes toward the 1.3630-1.3620 band on Thursday. Cable’s uptick comes despite the modest bounce in the Greenback, while investors gear up for key data releases on the UK calendar on Friday.

EUR/USD treads water near 1.1670

EUR/USD gives away all its initial gains and receded to the sub-1.1700 region. The US Dollar’s late recovery has dragged the pair lower, leaving it practically unchanged following the NA session on Thursday. In the meantime, investors gear up for the release of preliminary S&P Global Manufacturing and Services PMIs on both sides of the Atlantic on Friday.

Gold trims losses, back above $4,500

Gold manages to regain some composure and reclaim the area beyond the key $4,500 mark per troy ounce on Thursday. The yellow metal’s daily decline comes amid the humble improvement in the US Dollar while US Treasury yields remain on the rise following Wednesday’s marked retracement across the curve.

XRP extends rally as bullish technical signals underpin breakout attempt

Ripple holds in bullish hands, as price action extends above $1.16 at the time of writing on Thursday. Since Monday, the cross-border remittance token has surged by more than 20%, reflecting a steady growth in risk-on sentiment. The broader crypto market sentiment is on an upward roll at 62 in the Greed territory on Thursday, up from 46 the previous day, according to the Fear & Greed Index.

Why long bonds have repriced the cost of money

The 30-year Treasury is 12 basis points below its highest level since before the financial crisis. Not its highest since 2023, or since the tightening cycle, but since June 12, 2007, the last time the longest bond in the world's deepest market yielded what it yields on Thursday. Getting there took two attempts and most of the year.

$20 billion offered, $2 billion taken: Why Treasury doubled its buyback cap

The US Treasury moved off its own calendar on Wednesday, and that is the part worth sitting with. At 12:32 GMT, the department said it would at least double the size of liquidity support buyback operations in the 10-year to 20-year and 20-year to 30-year sectors, lifting the maximum from $2 billion per operation to at least $4 billion, effective September 9 and running to November 4.