AUD/USD Supported by RBA Hike Expectations Despite Broad USD Strength

The Australian Dollar is trading near its 200-day moving average support due to broad USD strength. However, this weakness is being offset by the expectation of a 25 basis point Reserve Bank of Australia (RBA) hike to 4.60% next week.

Australia's August labor force report showed stronger-than-expected job gains and higher participation rates. The economy added more jobs than expected, with actual job gains coming in at +39.5k, beating the consensus estimate of +20k.

The unemployment rate unexpectedly rose to 4.6%, above the RBA's year-end projection of 4.5%. However, this increase is largely due to a higher participation rate, suggesting some tightness in the labor market persists.