AUD/USD is testing resistance near 0.6625 as resilient global activity and Australia’s labor market trends support expectations for a slower pace of RBA easing. Traders are watching August employment data closely, with futures pricing around 50bps of rate cuts over the next year, BBH FX analysts report.

RBA expected to ease more cautiously than Fed

"AUD/USD is nearing key resistance at 0.6625, with a break above in sight. The RBA is on track to ease more cautiously than the Fed and global economic activity is resilient. Australia leading employment indicators argue for a gradual RBA easing path."

"The NAB Employment subindex increased to an 11-month high at 5.2 vs. 1.9 in July. The Westpac-Melbourne Institute Unemployment Expectations subindex rose 4.6% in September to its long run average, consistent with a stable rather than improving labor market."

"Australia’s August job print, due September 18, will be a big driver of RBA rate expectations. The RBA flagged that the pace of decline in the cash rate will largely be driven by labor market conditions. In the meantime, RBA cash rate futures continue to imply 50bps of easing over the next twelve months."